How are Mutual Funds Taxed?

Whenever a mutual fund company passes earnings and other payouts to shareholders, they are known as a distribution. The tax treatment of these distributions varies depending on the type of distribution. If you hold shares in a taxable account, you are required to pay taxes on mutual fund distributions, whether the distributions are paid out in cash or reinvested in additional shares.

Learn more about how certain mutual fund distributions are taxed by reading our recent article How are Mutual Funds Taxed?