I have investments in a mutual fund. That fund grew in value (i.e. had a distribution) So I got a 1099-DIV. I understand I have to pay capital gains tax on this growth.
However I also sold some of the shares of the fund. So I also got a 1099-B for the sale. I assume I have to pay taxes on this too.
Is the tax rate the same for a distribution and a sale?
I don't quite understand why I'm double taxed on the sale. Short of just "that's the way it is, deal with it" why did this happen?
EDIT: I did some more research and I think I may understand now, plz correct me if I'm wrong
The taxes I pay as part of the 1099-DIV are not taxes on the growth of the fund. They are only the taxes on money earned if the fund itself sells shares or if the shares themselves pay out a dividend.
If for example I owned 1 share of XYZ fund at $100 and over the year it grew in value to $110, and the fund itself never sold any shares, and the underlying assets in the fund didn't pay a dividend, then my 1099-DIV would show zero capital gains and I wouldn't get a 1099-B
If the next year I then sold that one share for $110 I would again not get a 1099-DIV but I would get a 1099-B. I'd owe taxes on the $10 capital gains I saw.
If I then sold that $110 share of