Undistributed Capital Gains -Form 2439

A mutual fund usually distributes all its capital gains to its shareholders. The mutual fund company reports these gains on Form 1099-DIV. However, a mutual fund might keep some of its capital gains and pay a tax on them. When this happens, the mutual fund company will send you a Form 2439: Notice to Shareholders of Undistributed Long-Term Capital Gains.

Report these capital gains even though you don’t actually receive them. However, since the mutual fund paid tax on the gains, you can claim a credit for the taxes they pay.

You also need to increase the basis of your mutual fund shares by the difference between these two items:

  • Amount of undistributed capital gains you report
  • Amount of taxes reported to you as paid

Related Topics

Related Resources

Bitcoin Income: Exploring Capital Gains & Stock Value | H&R Block

Have you recently earned Bitcoin income from rising stock value? Explore the rules surrounding cryptocurrency-sourced capital gains and losses with H&R Block.

Holiday Bonus Taxes

Congratulations on the Bonus! Learm more about the tax rate at H&R Block - whether you receive a holiday or cash bonus, it will apply to you.

What Is Cryptocurrency? | H&R Block

What is Cryptocurrency? Bitcoin, Litecoin, and the like leave many wondering how to classify this new form of investment. Find the answer at H&R Block.

The IRS, Bitcoin, and Other Virtual Currencies | H&R Block

Have you found yourself wondering how the IRS classifies Bitcoin? Our tax pros discuss relevant IRS Bitcoin law and notices. Learn more with H&R Block.