Funds Beginner: Taxes on Mutual Fund Income

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1.
Which would you rather own in a taxable account?
Choose wisely. There is only one correct answer.
It depends on which is the better aftertax performer. If you're investing in a taxable account, it's wise to consider taxes when investing. However, don't let the tax tail wag the investment dog. What's most important is how much you keep after taxes, not how much Uncle Sam gets.
2.
A capital loss is the return of your original investment back to you.
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False. A capital loss is a loss you suffer when you sell shares for less than the price you paid for them.
3.
Which of the following in a mutual fund is not taxable?
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A mutual fund share. Only income is taxable.
4.
Which IRS form reports withdrawals from retirement plans?
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1099-R. This form reports retirement plan withdrawals.
5.
An exchange of shares from one mutual fund to another in a fund family is a taxable event, except in the case of _______.
Choose wisely. There is only one correct answer.
Qualified retirement plans. Exchanges made within qualified retirement plans are tax-exempt.