2019 Year-End Distributions

[Amethyst]

On top of that, some dividends are taxed as regular income, which is the pits.

Not dumb. I agree with you.

Go to bogleheads.org and search for "total return vs dividend investing" for more info.

Mathematically, dividends are equivalent to a forced sale. To be avoided, IMO.

 

[bingybear]

The mutual fund company has to track it, and you aren't paying taxes on the same money twice. You are taxed on the dividends, and the reinvestment adds to your cost basis.

Say you bought 100 shares at $10. You have a basis of $1000 (100*$10).

Then you get a dividend of 20 cents/share. 100*.20 is $20, and that dividend is taxed.

You chose to reinvest dividends, the they buy new shares with that $20. For simplicity, say the share price is still $10. They buy 2 new shares for you. Your basis for those shares is 2*$10 or $20. You now have a basis of $1020 on all of your shares.

That's great if you buy a MF from a MF company. I think most are tracked by brokers such as Schwab, Fidelity, Vanguard and the like. The brokers use to get a small cut of the fees for doing the book keeping.


The brokers also do this for individual stocks, REITS, ETFs, etc.


When I go to sell an asset I can select specific shares on most things and the web page will give me choice of which lots to use.

 

[N02L84ER]

Our projected long term capital gains are 8% greater than our 2017 LTCG were, but 21% less than our 2018 LTCG were.

 

[SecondCor521]

So you reinvest dividends, STG, LTGs in taxable accts and pay the taxes, but when you sell you don't pay taxes again on that amount. Who keeps track of that and do you specify when selling later?
The mutual fund company, tax guy, me and tax guy??

I disagree with RunningBum's reply.

You, the taxpayer, are *always* responsible for proper reporting of cost basis. It's your signature at the bottom of your 1040 saying things are accurate, not your mutual fund company or your tax guy.

There was a change a few years ago that mutual fund companies are required to track and report basis to the IRS for certain investments purchased after certain dates starting in 2011.

However, for shares purchased before those dates, basis information may or may not be reported to the IRS. Further, the basis they have could be wrong. The basis might be missing. Or it may not match the cost basis method you've elected to use. It also might not take into account transaction costs. Finally, it won't take into account adjustments to basis, such as QSBS.

You can choose to rely on your mutual fund company's information, and it's probably correct most of the time, especially if you haven't done anything complicated and the mutual fund company is one of the reputable / capable ones, and especially if you bought covered shares.

Here's a Vanguard web page that talks about all of this:

https://investor.vanguard.com/taxes/cost-basis/covered-noncovered

I think your tax guy is only responsible for knowing the tax laws, making sure you're giving him all of the relevant information, and accurately and competently completing your tax forms.

 

[steelyman]

You, the taxpayer, are *always* responsible for proper reporting of cost basis. It's your signature at the bottom of your 1040 saying things are accurate, not your mutual fund company or your tax guy.

I agree. I acted as trustee for a couple of trusts where cost basis was missing for many long-held shares. They were all at Schwab and they (Schwab) were good at updating basis to date of death, but I had to take the initiative to ask and specify DoD for the accounts (husband/wife). It mattered for 1041 filing.

 

[GalaxyBoy]

Schwab has posted their actual distributions for 2019. OTOH, since we're at the payment date you could just wait and check your account tonight (or soon, hopefully).

https://ims.schwab.wallst.com/repository/?doc=SchwabFundsDistributions2019

[Edit to add] Well, my bad, a bit anyway. The document is entitled "actual" but that's only for the funds that have paid today; the others are still noted as "estimated." But they pay in the next few days. I hope it's a useful resource in any case.

 

[gayl]

Mine hit last night

 

[pb4uski]

FWIW, Vanguard distributions seem to be coming in stronger than advertised.

VTIAX (Total International Stock Admiral): $0.3351 actual vs $0.31 estimate.... 8% stronger
VFIAX (S&P 500 Index Admiral): $1.4326 actual vs $1.33 estimate.... 8% stronger

YMMV.

Estimates: https://advisors.vanguard.com/iwe/pdf/FA117420.pdf

 

[RunningBum]

FWIW, Vanguard distributions seem to be coming in stronger than advertised.

VTIAX (Total International Stock Admiral): $0.3351 actual vs $0.31 estimate.... 8% stronger
VFIAX (S&P 500 Index Admiral): $1.4326 actual vs $1.33 estimate.... 8% stronger

YMMV.

Estimates: https://advisors.vanguard.com/iwe/pdf/FA117420.pdf

Where are you seeing actuals? I'm not seeing anything in my account yet.

 

[pb4uski]

Came into my account today. I was surprised as I wasn't expecting them until Monday based on the date in the link.

 

[pb4uski]

FWIW, Vanguard distributions seem to be coming in stronger than advertised.

VTIAX (Total International Stock Admiral): $0.3351 actual vs $0.31 estimate.... 8% stronger
VFIAX (S&P 500 Index Admiral): $1.4326 actual vs $1.33 estimate.... 8% stronger

YMMV.

Estimates: https://advisors.vanguard.com/iwe/pdf/FA117420.pdf

Same with VTSAX... $0.4289 vs $0.4100..... ~5% stronger.

Mine are all in now... just did year end Roth conversion... biggest unknown in terms of 2019 taxable income and taxes is amount of foreign taxes paid on taxable account international equities.

 

[scrabbler1]

One other wrinkle that probably affected you is that the FPL numbers used are offset by one year. So the $12,140 is the 2018 number, but it is what is used on 2019 tax returns. The $12,490 is the 2019 number, but it is what will be used on 2020 tax returns.

So probably you found some reference that said that the number is $12,490 for 2019, and didn't realize there is a one year offset.

This is what I did, and I will be more mindful to make sure I use year-1's FPL from now on.

It seems strange that I am rooting for a drop in the NAV of the fund whose shares I wish to sell so I can generate enough of a loss to move back under the MAGI limit. I know it will drop after it makes its distribution this Friday. With the broken, holiday week, there will be fewer trading days for its price to rise much further.

I do have some shares in a bond fund I can sell at a small loss if I need to generate a little more cap losses to squeak under the limit.

 

[RunningBum]

Same with VTSAX... $0.4289 vs $0.4100..... ~5% stronger.

Mine are all in now... just did year end Roth conversion... biggest unknown in terms of 2019 taxable income and taxes is amount of foreign taxes paid on taxable account international equities.

I finally got mine for VTIAX. Yesterday I saw money show up under "Total credits and debits" but no transaction to explain it. I knew it must be dividends but that's odd that they'd show money but no explanation. I still don't have anything for VTSAX or VTCLX. But it's nice to see your numbers. I don't have much in VTCLX, and with the updated VTSAX dividend you got I'm about $1200 under 400% FPL, with a buffer of using 1.08 for the VTIAX foreign taxes rather than the more likely 1.07. No conversions for me this year.

 

[RunningBum]

Actually a little more money showed up today, and under Transactions>Div and CG distributions I see VTCLX under "Intra day ...". I either missed it or VTIAX didn't show up there earlier. Still nothing at all for VTSAX.

 

[JoeWras]

Yep, not VTSAX yet, as of 12:30EST.

I'm getting surprisingly close to 2018 in total. Probably will be within 10% of last year.

 

[RunningBum]

pb4, do you have a VG brokerage account, or did you stick with the old style? Wondering if that's an explanation for seeing yours earlier than us.

 

[walkinwood]

Yep, not VTSAX yet, as of 12:30EST.

I'm getting surprisingly close to 2018 in total. Probably will be within 10% of last year.

You can see the per-share distributions here (except for foreign taxes paid).
https://investor.vanguard.com/mutual-funds/profile/distributions/vtsax

Today is the "payable" day, so you'll probably see it in your VG account tomorrow or the 26th.

 

[pb4uski]

pb4, do you have a VG brokerage account, or did you stick with the old style? Wondering if that's an explanation for seeing yours earlier than us.

Our taxable accounts are regular mutual fund accounts. I wonder if for some reason that brokerage accounts are T+2.

 

[RunningBum]

Our taxable accounts are regular mutual fund accounts. I wonder if for some reason that brokerage accounts are T+2.

Another small way that Vanguard misrepresented the conversion.

Today I see more money under "total credits and debits" but nothing pending on VTSAX. And the money is a few hundred more than I expected to get with the VTSAX dividend even after updating with your actual div/share amount. Maybe it's money market interest. It just doesn't seem like I should have to be guessing about where money is coming from. It also reduces the time in an already tight window for making a final conversion, if I was doing one this year.

 

[Rianne]

biggest unknown in terms of 2019 taxable income and taxes is amount of foreign taxes paid on taxable account international equities.

This usually posted in Feb. Trying to make sure our ACA income stays below $65K. I have a good idea unless drastic changes in market in the next few days.

 

[KB]

Runningbum,
At the top of the Vanguard page, I clicked on ACTIVITY to see what money had posted to which account. My MM account is not completely updated, it shows dashes in all the dollar fields. But VTSAX is listed with the Dividend in the Activity section, and my amount was a little higher than I expected also.

I have a access to my kids accounts and my sister's account and all of them posted their Dividends on the 23rd with mine posting on the 24th. I guess VG has more accounts than can post in one nightly cycle and it takes two days to update all. This happens to me all the time, my account is always a day later than my family members accounts.

 

[pb4uski]

KB, Is your account a brokerage account and are theirs mutual fund accounts?

 

[JoeWras]

Another small way that Vanguard misrepresented the conversion.

Today I see more money under "total credits and debits" but nothing pending on VTSAX. And the money is a few hundred more than I expected to get with the VTSAX dividend even after updating with your actual div/share amount. Maybe it's money market interest. It just doesn't seem like I should have to be guessing about where money is coming from. It also reduces the time in an already tight window for making a final conversion, if I was doing one this year.

Not sure what you are not seeing. On our account, it is all posted under "activity->transaction history."

VTSAX came through and exactly matches the numbers here: https://investor.vanguard.com/mutual...ibutions/vtsax

 

[W2R]

Not sure what you are not seeing. On our account, it is all posted under "activity->transaction history."

VTSAX came through and exactly matches the numbers here: https://investor.vanguard.com/mutual...ibutions/vtsax

My VTSAX annual dividends came through also, as did dividends and capital gain for VWIAX, and dividends for VFWAX. They are all sitting there in my money market (settlement) account as expected, in the expected amounts according to the final figures, not according to the estimates from weeks ago. I have the brokerage accounts now.

I can't imagine why these dividends wouldn't be showing up on someone's activity tab when they log into Vanguard. Could it be that the brokerage accounts are getting these dividends earlier than those remaining old accounts? Otherwise I have no ideas.

 

[KB]

KB, Is your account a brokerage account and are theirs mutual fund accounts?

My account and my sister's account are brokerage and my kids are regular accounts. So basically her account was paid a day before mine and we both have brokerage accounts.