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George owns 1,000 shares of ABC common stock and 3,000 shares of Brightstar mutual fund. George elects to participate in Brightstar's dividend reinvestment plan, reinvesting his annual dividends and capital gains distributions in additional Brightstar shares. George receives a $5,000 distribution from ABC and a Form 1099-DIV indicating that $4,000 of the distribution is ordinary dividend and $1,000 is a nontaxable distribution.

He also receives a Form 1099-DIV from Brightstar mutual fund indicating that he has an ordinary dividend of $6,500 and a capital gains distribution of $1,300 for a gross distribution of $7,800 that is reinvested in 90 additional shares of Brightstar mutual fund.

How much does George include in his gross income for the year?

Macroeconomics, Economics

  • Category:- Macroeconomics
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