Which of the Following Is True About Mutual Funds and Taxes

question 63

Multiple Choice

Which of the following is true about mutual funds and taxes?

• A) Capital gain distributions are taxed as short-term capital gains.
• B) Income dividends are taxed quarterly.
• C) Investment companies are required to send each shareholder a year-end statement that specifies how much each received in income dividends and capital gain distributions.
• D) Capital gains distributions are not reported on your federal tax return.
• E) Taxes can be eliminated if you hold your mutual fund shares in your 401(k) retirement account.

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Definitions:

Promotional Mix

The combination of marketing tools used by a business to achieve its marketing objectives, including advertising, sales promotion, public relations, and direct marketing.

Strengths/Advantages

Positive attributes or aspects of something that give it a competitive edge or make it superior in some respects.

Weaknesses/Disadvantages

The aspects of a situation or organization that are detrimental to achieving success or objectives.

Do-Not-Track Regulations

Laws or policies that allow users to opt-out of tracking by websites and online services, aimed at protecting user privacy.