Review the tax information sent with your forms (PDFs below).
Tax Forms and Statements
Look for your year-end statement to arrive during the first two weeks of January.
Whether you receive a tax form depends on the type and amount of activity on your fund/account each year. Generally, we send a form in January when you sell or exchange shares or if your fund paid a distribution.
However, we will not send Form 1099-DIV if you have dividends and capital gains totaling under $10 for any one fund (exception: funds passing a foreign tax credit). Also, we will not send Form 1099-B if your redemption is less than one share and the gross proceeds are less than $20 for any one redemption (does not apply to brokerage). Although the IRS does not require us to report activity under these amounts, you may be required to report this information on your tax return.
The fee (e.g. maintenance, wire or advisor fee) is a redemption that is treated as a sale of capital assets and reportable on Form 8949. When the fee is taken, we will deplete shares from your account based on the cost basis method on file for the account, and adjust the cost basis for the tax lot used for the redemption.
Please note: If the shares sold for the fee are less than one full share and the gross proceeds for the fee is less than $20, we will not report on Form 1099-B. However, you may still be required to report the sale on Form 8949. Please consult your tax advisor, or refer to IRS Publication 550 for the proper reporting of fees and other expenses.
Due to IRS regulations, we cannot send you a tax form indicating zero or showing no activity.
If you determine that a correction needs to be made, contact us and we can provide a corrected form. If you receive a correction to:
- Form 1099-DIV, 1099-B, 1099-Q, 5498-ESA or 5498, your corrected form will include all previously reported tax information. You may discard the original form.
- Form 1099-R or 1042-S, your corrected form will show only the corrected information. You must retain both the original form and the corrected form.
The foreign tax reported in column 6 on Form1099-DIV is based on your share of the foreign taxes paid at the mutual fund level, which is also included in the total ordinary dividends in column 1a. The foreign taxes paid are based on the income the mutual fund received from its investments in foreign corporations and the taxes the fund paid to foreign governments. The annual report for the fund provides additional information regarding the calculation of the foreign tax.
If you have met the holding period requirement, 100% of the foreign tax credit reported in column 6 on Form 1099-DIV is eligible to be claimed as a foreign tax credit this year.
Holding period requirement - At the time of the distribution, you must have held the shares for 16 days or more during the 31-day period. The 31-day period begins 15 days before the shares ex-dividend date. If you are unable to use the foreign tax credit, you may be able to claim it as an itemized deduction.
Where to report the credit - For U.S. individuals with:
- No more than $300 ($600 for married individuals filing jointly) of foreign tax and no foreign source income, other than passive income (e.g., mutual fund dividends), you may claim the credit directly on Form 1040.
- More than $300 ($600 for married individuals filing jointly) of foreign tax or who have foreign source income, other than passive income, you will need to complete Form 1116 to claim the credit. (For additional information, see Form 1116 instructions.)
Additional information can also be found in Publication 514, Foreign Tax Credit for Individuals.
If you've sold shares at a loss and repurchased substantially similar shares within 30 days and do not see a wash sale on your tax form, it may be due to one of the following reasons:
- You have sold non-covered shares at a loss, and purchased covered shares within 30 days before or after the sale. (Refer to When You Purchased Shares Matters in What the Changes to Cost Basis Mean to You)
- You have sold shares at a loss and purchased shares in the same fund with another broker within 30 days before or after the sale.
- You have sold shares from a taxable account at a loss and contributed to an IRA in the same fund within 30 days before or after the sale from the taxable account.
Generally, you should report the wash sale on your Form 8949 in column G. For more information, refer to IRS Publication 550 or the instructions for Form 8949.
If you are invested in the Real Estate and/or Global Real Estate fund in a taxable account, we will send Forms 1099-DIV and 1099-B in late February. Learn more about the postponed mail date. If you own these funds in a retirement account and sold shares, we will send Form 1099-R by the end of January the following year.
Form 5498, which is sent in May, reports your IRA contributions. Depending on the timing and account type, your transactions may appear on the form for the current tax year or the next year.
- Traditional and Roth IRA Contributions
Any contribution made for 2016--even if it's made in 2017 before the April 15th deadline-will appear on the 2016 form.
- Rollover Contributions and Roth IRA Conversions
Only transactions made during 2016 will appear on the 2016 form. Transactions made after January 1, 2017, will appear on next year's form.
- Recharacterized Contributions
Only 2016 contributions recharacterized during 2016 will appear on the 2016 form, although you may recharacterize these contributions until October 15, 2017. Contributions recharacterized after January 1, 2017, will appear on next year's form.
- SEP IRA, SARSEP IRA and SIMPLE IRA Contributions
Only contributions made during 2016 will appear on the 2016 form. Contributions made after January 1, 2017, for tax year 2016 will appear on next year's form.
Before your Giftrust matures, you do not have to file any of the tax returns for your Giftrust. This is taken care of by the Giftrust trustee. After your Giftrust matures, you will be personally responsible for the necessary tax reporting and payment of taxes due on distributions or capital gains. Learn more.
Can I deposit My Tax Refund directly into my American Century Investments account?
A fast and simple way to get your IRS refund working for you is to have it deposited directly into your existing American Century Investments account. Simply complete the "Refund" section of your IRS tax return as follows:
- Routing Number: 101000019
- Type: Checking
- Account Number: 9996XXXXXXXXXXXX (Replace Xs with your 12-digit fund account number without the hyphen, leave remaining boxes empty)
Please do not send a voided American Century Investments CheckWriting check to the IRS as a record of your account number.
There are two types of distributions: income and capital gains. Mutual fund companies must pass along 98% of the net amount of both types of distributions to their shareholders.
- You will receive income distributions if the securities in your fund pay dividends or interest.
- You will receive capital gain distributions if the sale of securities within your mutual fund creates a profit. These gains will be designated as short- or long-term based on how long the securities were held in the portfolio, not on when you purchased fund shares.
Note: Fund share prices drop by the amount of the dividend/capital gain when a fund pays its distribution.
Tax rules require mutual funds to distribute 98% of net investment income and capital gains to shareholders each year. The rules also allow mutual funds to offset capital gains with losses carried forward from a prior year.
Your Form 1099-DIV will show your total, qualified dividends and capital gains. The amount of tax you pay depends on the type of distribution and your tax bracket.
|Ordinary Dividends and
Short-Term Capital Gains*
|Shown in column 1a of your 1099-DIV||Taxed at the same rate as ordinary income|
|Qualified Dividends||Shown in column 1b of your 1099-DIV||Taxed at 0%, 15% or 20% depending on your tax bracket|
|Long-Term Capital Gains*||Shown in column 2a of your 1099-DIV||Taxed at 0%, 15% or 20% depending on your tax bracket|
|Unrecaptured Section 1250 Gains||Shown in column 2b of your 1099-DIV||Taxed at 25%|
*Short-term capital gains are assets held fewer than 12 months. Long-term capital gains are assets held more than 12 months.
The Securities and Exchange Commission requires mutual funds to pay and report short-term capital gains and ordinary dividends separately. However, the IRS requires mutual funds to report short-term capital gains and dividends together on Form 1099-DIV because they are taxed as ordinary income. Long-term capital gains are reported separately because they are taxed at lower rates.
Clients who held the Vista Fund on December 6, 2013, when the fund combined with the Heritage Fund, may need additional information to complete their cost basis.
Please use the following information to determine cost basis for those accounts.
- When the Vista Fund/Heritage Fund combination occurred, the underlying tax lots from the Vista Fund were moved into the Heritage Fund.
- When the tax lots are moved, most of the cost basis information remains the same including: cost basis amount, date of acquisition, covered/non-covered shares, etc.
- However, the number of shares and cost per share in each tax lot will change.
Clients in certain IRAs and retirement accounts are required to withdrawal a minimum amount each year, generally starting at age 70½. Learn more.
For Tax Year 2017:
- Employee's Salary Deferral Limit: $18,000
- Contribution Limit for Investors Age 50 or Over (includes Catch-Up): $24,000
The Pension Protection Act of 2006 makes permanent higher contribution limits for IRAs and employer-sponsored retirement plans. The limits have been in effect since 2001.
If you are at least 50 years old before the end of the year, you are allowed to make additional "Catch-Up" contributions as you approach retirement.
Please refer to IRS Publication 560 and 590 for more information about IRA contribution deadlines and limits.
- Traditional and Roth IRA contributions
2016 contributions can be made until April 17, 2017. Contributions made after January 1, 2017, are credited for 2016 only if you request it.
- SEP, SARSEP and SIMPLE IRA contributions
2016 employer contributions can be made until the employer's 2016 tax-filing deadline (including any extensions). Contributions received after January 1, 2017, will appear on your Form 5498 for 2017, which will be sent in 2018.
You have some options available if you have contributed more than the maximum allowed for the tax year. These include applying the amount to the following tax year (if applicable) or removing the excess amount.
If you've contributed to a Roth beyond the eligibility requirements for your income, you may also be able to recharacterize your contributions. We recommend that you work with your tax advisor to determine which option is best for you because they can involve tax penalties. For more specific details, please see information about Excess Contributions in the Disclosure Statement and Custodial Agreement booklet, or visit www.irs.gov.
This information is for educational purposes only and is not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.