Dividends and Distributions
The Trust has paid dividends in each quarter since its organization. The Trust earns dividends, interest and other income from its investments, and distributes this income (less expenses) to shareholders as dividends. These payments are generally made around the end of February, May, August and November. The Trust may also realize net capital gains from its investments, and would distribute these gains (net of any losses) to shareholders as capital gain distributions. The last capital gains distribution made by the Trust was in 1998.
When you open an account, specify on your application how you want to receive your distributions. The following options are available for the Trust’s distributions:
(1) Reinvestment Option. Your dividends and capital gains distributions will be automatically invested in additional shares of the Trust. If you do not indicate a choice on your application, you will be assigned this option;
(2) Cash/Reinvest Option. Your dividends will be paid in cash. Your capital gains distributions will be automatically reinvested in additional shares of the Trust;
(3) Cash Option. Your dividends and capital gains distributions will be paid in cash.
Note: For quicker access to your cash distributions the Trust recommends direct deposit for shareholders electing Option 2 or 3.
If you elect to receive your distributions paid by check and your check remains uncashed for a period of six months, your distribution option may be converted to the Reinvestment Option. You will not receive interest on amounts represented by uncashed distribution checks.
Trust Dividend Distribution Information
| Ex-Dividend Date | 2/13/2024 |
| Payable Date | 2/14/2024 |
| Rate | $.05 |
| Recent Distributions and Rates | |
| 11/21/2023 | $.04 |
| 8/22/2023 | $.04 |
| 5/23/23 | $.05 |
| Trailing 12-Month Distribution Yield (as of 12/31/23)* | 4.96% |
| * Trailing 12-Month Distribution Yield is the yield an investor would have received if they held the fund over the last 12 months assuming the most recent NAV. The 12-Month distribution yield is calculated by assuming any income distributions over the past 12 months and any capital gain distributions made over the past 12 months and dividing the sum by the most recent NAV. TTM distribution yield is not a reflection of future results. |
Tax Information for 2023
0% of the income reported in Box 1 of your 2023 Form 1099-DIV was derived from United States Government Obligations.
All or a portion of your ordinary income dividend may be taxed at a reduced capital gain rate rather than the higher marginal rates applicable to ordinary income. The amount of your dividend subject to this lower rate is reported as Qualified Dividends in Box 1b of your Form 1099-DIV. The annual qualified dividend rate for the Trust for 2023 was 2.153%. This percentage is applied to the income dividends paid for the calendar year as reported on Box 1a of your Form 1099-Div. Your rate may differ from this percentage depending on your transaction activity and/or holding periods. Please refer to the instructions for Form 1040 for additional information and restrictions or consult a tax professional.
Tax Consequences
An investment in the Trust could have tax consequences for you. The prospectus provides only general tax information. If you are investing through a tax-deferred retirement account, such as a 401(k) plan or and individual retirement account, special tax rules may apply. Otherwise you should consider these tax consequences by consulting your tax advisor.
Taxes on Distributions. Distributions you receive from the Trust whether by cash or reinvested shares may be subject to federal, state or local taxes unless you are exempt from taxation.
For federal tax purposes, the Trust’s dividends made from income and distributions of short-term capital gains are taxable to you as ordinary income a portion of which may or may not be considered “qualified”. The Trust’s distributions of long-term capital gains are taxable to you generally as capital gains. All such distributions to certain individuals, trusts and estates may be subject also to Medicare new investment income tax at a rate of 3.8% depending upon the adjusted gross income of the recipient.
If you buy shares when the Trust has realized but not yet distributed income or capital gains, you will be “buying a dividend” by paying the full price for the shares and then receiving a portion of the price back in the form of a taxable distribution.
Taxes on transactions. Your redemptions may result in a capital gain or loss for federal tax purposes. A capital gain or loss on your investment in the Trust is the difference between the cost of your shares and price you receive when you sell them. Reinvested distributions add to the cost basis of your investment.
Cost Basis Reporting. The Internal Revenue Service (“IRS”) requires mutual funds to report the cost basis of shares acquired by a shareholder on or after January 1, 2012 (“covered shares”) and subsequently sold. Mutual funds are not required to report cost basis to the IRS on shares acquired prior to January 1, 2012 (uncovered shares”). These requirements do not pertain to tax-deferred retirement accounts such as 401(k) plans or individual retirement accounts. The cost basis is generally the purchase price of the shares adjusted for reinvested dividends and capital gains distributions. Cost basis is used to determine whether a shareholder incurred a gain or loss when redeeming shares of a fund. Cost basis for any covered shares sold during the year will be reported to the shareholder and to the IRS on Form 1099-B. The Trust will permit shareholders to select from several IRS-accepted cost basis methods to calculate cost basis of your covered shares. If no method is selected, the Trust will use its default methodology-Average Cost. The cost basis method elected may not be changed after the settlement of a sale of Trust shares. Please consult your tax advisor should you need assistance in determining which cost basis calculation you should elect.
