This section provides information regarding distributions made to taxable accounts only.
One of the more common taxable events you may experience as a mutual fund shareholder is your fund's distribution of ordinary income or capital gains.
Why Funds Pay Distributions
Mutual funds are required to distribute their ordinary income and capital gains, if any, to avoid taxation of the fund. If the fund has neither ordinary income nor capital gains, you will not receive a distribution from the fund.
You should be aware that distributions from a taxable mutual fund account are not value-enhancing and may create income tax obligations. On the date of the distributions, the share price of a fund drops by the amount of the distribution, net of any market fluctuations. As an example, assume that on December 31, the fund declared a dividend in the amount of 25 cents per share. If the fund's closing share price on December 30 was $10.00, the fund's share price on December 31 would be $9.75 assuming no market fluctuations.
Ordinary income is the total of the fund's net investment income and net short-term capital gains.
Net Investment Income
Dividends and interest paid on the securities held by a mutual fund are referred to as investment income. The fund deducts its annual expenses from its investment income. Any investment income remaining after expenses are deducted is known as net investment income.
Short-term Capital Gains
When the fund sells a security, it generally realizes a gain or loss. If the security sold was held for 12 months or less, the gain or loss is considered short-term.
Capital gains distributions
When the fund sells a security, it generally realizes a gain or loss. If the fund held the security for more than 12 months, the gain or loss is long-term.
During the year, losses on the sale of securities are used to offset gains. If the fund has more losses than gains, any remaining losses may be carried forward and used to offset gains realized in future years.
Distributions and Taxes
You have the option of accepting a dividend or capital gains distribution in cash or using the money to purchase more mutual fund shares - that is, reinvesting the dividends. You should report all distributions as taxable income regardless of whether they are paid in cash or reinvested.
Dividends paid by a tax-exempt fund may be exempt from both federal tax and certain state and local taxes. See the Janus Supplementary Tax Info page.
Tax information is available by January 31st of each year.
You can also have personal capital gains or losses from buying & selling.
View current and prior year dividends and capital gains distributions for all funds.