Publication 564 - Mutual Fund Distributions Instructions - 2002
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16Publication 564
Contents
Cat. No. 15112N
Important Change . . . . . . . . . . . . . . . . 1
Department
Mutual Fund
of the
Important Reminders . . . . . . . . . . . . . . 1
Treasury
Distributions
Introduction . . . . . . . . . . . . . . . . . . . . . 2
Internal
Revenue
Tax Treatment of Distributions . . . . . . . 2
Service
Ordinary Dividends . . . . . . . . . . . . . . 2
Capital Gain Distributions . . . . . . . . . 2
For use in preparing
Exempt-Interest Dividends . . . . . . . . . 2
Return of Capital (Nontaxable)
2002
Distributions . . . . . . . . . . . . . . . 3
Returns
Reinvestment of Distributions . . . . . . . 3
How To Report . . . . . . . . . . . . . . . . 3
Keeping Track of Your Basis . . . . . . . . . 3
Sales, Exchanges,
and Redemptions . . . . . . . . . . . . . . 6
Identifying the Shares Sold . . . . . . . . 6
Gains and Losses . . . . . . . . . . . . . . 8
Investment Expenses . . . . . . . . . . . . . . 10
Limit on Investment Interest
Expense . . . . . . . . . . . . . . . . . . 10
Comprehensive Example . . . . . . . . . . . 11
How To Get Tax Help . . . . . . . . . . . . . . 15
Index . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Important Change
Reporting interest and dividends. Interest
or ordinary dividend income that exceeds a cer-
tain amount must be reported on a separate
schedule. For 2002, this amount has increased.
If you file Form 1040A, you must now attach
Schedule 1 to your return if your interest or
dividend income is more than $1,500; if you file
Form 1040, you must now attach Schedule B to
your return if your interest or dividend income is
more than $1,500. Before 2002, you had to
attach Schedule 1 or Schedule B if your interest
or dividend income was more than $400.
Important Reminders
8% capital gain rate. The 10% capital gain
rate is lowered to 8% for qualified 5-year gain.
See Capital Gain Tax Rates, later.
10% capital gain rate. Beginning in 2006, the
20% capital gain rate will be lowered to 18% for
qualified 5-year gain. The holding period for the
property sold must have begun after 2000.
Photographs of missing children. The Inter-
nal Revenue Service is a proud partner with the
National Center for Missing and Exploited Chil-
dren. Photographs of missing children selected
by the Center may appear in this publication on
pages that would otherwise be blank. You can
help bring these children home by looking at the
photographs and calling 1 – 800 – THE – LOST
(1 – 800 – 843 – 5678) if you recognize a child.
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