Waddell & Reed

1099 Tax Information

This tax information should not be considered tax or legal advice. Neither WI Services Company, its affiliates or representatives provide tax advice. Please contact your legal or tax advisor for information regarding your individual situation.

IRS Resources

  • General Information: (800) 829-1040 (Spanish-speaking assistance available)
  • TTY/TDD Telephone Service:(800) 829-4059
  • Web Site: www.irs.gov

Key IRS Publications

Forms and publications are available on the IRS website at www.irs.gov. This information is also available at your local IRS office, post office, library, or by calling (800) TAX-FORM.

  • 17: Your Federal Income Tax for Individuals
  • 505: Tax Withholding and Estimated Tax
  • 509: Tax Calendars for 2011
  • 514: Foreign Tax Credit for Individuals
  • 525: Taxable and Nontaxable Income
  • 550: Investment Income and Expenses
  • 553: Highlights of Tax Changes
  • 560: Retirement Plans for Small Business
  • 571: Tax-Sheltered Annuity Plans (403(b) Plans)
  • 575: Pension and Annuity Income
  • 590: Individual Retirement Arrangements
  • 910: Guide to Free Tax Services
  • 929: Tax Rules for Children and Dependents
  • 970: Tax Benefits for Education

IRS Tele-Tax Topics

IRS tax topics have recorded information on approximately 150 topics that answer many federal tax questions. A complete list can be found in your IRS Form 1040 Instructions or by calling (800) 829-4477.

Interest from U.S. Government Obligations

Some states allow taxpayers to exclude interest received by U.S. Government obligations from taxable income. The information below shows the percentage of ordinary income each fund received from three categories of U.S. Government obligations. Ordinary income, shown in box 1a on the Form 1099-DIV, includes both investment income and short-term capital gains, if applicable. Please consult your tax advisor to determine which, if any, of the obligations may be exempt under your state’s tax laws.

Waddell & Reed Advisor Funds Direct U.S. Government Obligations1 Mortgage Backed Securities Repurchase Agreements
Accumulative 0.00% 0.00% 0.00%
Asset Strategy 0.00% 1.60% 0.00%
Bond 9.80% 25.90% 0.00%
Cash Management 5.80% 0.00% 0.00%
Continental Income 15.40% 1.60% 0.00%
Core Investment 0.00% 0.00% 0.00%
Dividend Opportunities 0.00% 0.00% 0.00%
Global Bond 5.20% 4.50% 0.00%
Government Securities 30.60% 62.00% 0.00%
High Income 0.00% 0.00% 0.00%
International Growth 0.00% 0.00% 0.00%
Municipal Bond 0.00% 0.00% 0.00%
Municipal High Income 0.00% 0.00% 0.00%
New Concepts 0.00% 0.00% 0.00%
Science & Technology 0.00% 0.00% 0.00%
Value 0.00% 0.00% 0.00%

Ivy Funds Direct U.S. Government Obligations1 Mortgage Backed Securities Repurchase Agreements
Asset Strategy 0.00% 0.30% 0.00%
Asset Strategy New Opportunities 0.00% 0.00% 0.00%
Balanced 4.40% 1.60% 0.00%
Bond 5.60% 32.50% 0.00%
Core Equity 0.00% 0.00% 0.00%
Cundill Global Value 0.00% 0.00% 0.00%
Dividend Opportunities 0.00% 0.00% 0.00%
European Opportunities 0.00% 0.00% 0.00%
Global Bond 6.20% 2.90% 0.00%
High Income 0.00% 0.00% 0.00%
International Balanced 0.00% 0.00% 0.00%
International Core Equity 0.00% 0.00% 0.00%
Limited-Term Bond 11.80% 24.40% 0.00%
Managed European/Pacific 0.00% 0.00% 0.00%
Managed International Opportunities 0.00% 0.00% 0.00%
Micro Cap Growth 0.00% 0.00% 0.00%
Money Market 4.20% 0.00% 0.00%
Mortgage Securities 1.00% 56.70% 0.00%
Municipal Bond 0.00% 0.00% 0.00%
Municipal High Income 0.00% 0.00% 0.00%
Pacific Opportunities 0.00% 0.00% 0.00%
Real Estate Securities 0.00% 0.00% 0.00%
Science & Technology 0.00% 0.00% 0.00%
Small Cap Value 0.00% 0.00% 0.00%
Value 0.00% 0.00% 0.00%

1Due to state law, residents of California, Connecticut and New York are subject to State Income Tax on Direct U.S. Government Obligations. Please consult your tax advisor for more information

Municipal Bond Interest by State

Many states require taxpayers to include income derived from municipal bonds as taxable income for state income tax purposes. Some states allow taxpayers to exclude municipal income derived from their state of residence. The information below shows the percentage of tax-exempt earnings of the municipal funds from municipal bonds issued within each state. Please consult your tax advisor as to the reporting of dividends received from these funds as prescribed by your state’s tax laws.

State Advisor Municipal Bond Fund Advisors Municipal High Income Fund Ivy Municipal Bond Fund Ivy Municipal High Income Fund
Alabama 0.77% 0.16% 2.49% 0.16%
Alaska 0.20% 0.00% 0.00% 0.00%
Arizona 1.25% 2.39% 1.64% 2.82%
Arkansas 0.06% 0.14% 0.05% 0.11%
California2 14.46%1 6.72%1 10.37%1 9.35%1
Colorado 2.90% 8.97% 5.30% 7.61%
Connecticut 0.95% 1.03% 0.41% 0.73%
Delaware 0.00% 0.00% 0.00% 0.00%
Dist. of Columbia 0.56% 0.00% 1.77% 0.04%
Florida 8.01% 2.70% 9.15% 2.70%
Georgia 2.93% 0.99% 1.20% 0.83%
Hawaii 0.00% 0.34% 0.21% 0.57%
Idaho 0.55% 0.00% 0.00% 0.34%
Illinois 2.48%1 6.99%1 2.47%1 8.86%1
Indiana 2.38% 2.49% 3.45% 2.19%
Iowa 0.85% 2.19%1 1.27% 0.24%1
Kansas 2.05% 3.42% 1.14% 2.09%
Kentucky 1.50% 0.67% 3.15% 1.94%
Louisiana 1.84% 0.86% 2.19% 1.12%
Maine 0.22% 0.00% 0.00% 0.09%
Maryland 0.74% 0.57% 1.07% 0.72%
Massachusetts 1.25% 1.36% 1.55% 0.08%
Michigan 2.82% 5.05% 2.17% 6.32%
Minnesota 0.64%1 0.00%1 1.24%1 0.44%1
Mississippi 0.00% 0.00% 0.88% 0.00%
Missouri 3.71% 13.25% 5.13% 9.05%
Montana 0.00% 0.00% 0.00% 0.00%
Nebraska 0.15% 0.00% 0.00% 0.00%
Nevada 1.18% 2.38% 1.25% 0.56%
New Hampshire 1.06% 0.07% 0.98% 0.08%
New Jersey 3.44% 1.75% 3.37% 1.70%
New Mexico 0.72% 0.00% 0.60% 0.00%
New York 5.02% 3.70% 2.75% 2.84%
North Carolina 1.19% 0.11% 1.73% 0.34%
North Dakota 0.00% 0.00% 0.00% 0.00%
Ohio 2.02% 2.13% 1.65% 4.05%
Oklahoma 0.42% 0.84% 1.67% 1.40%
Oregon 0.12% 0.85% 0.29% 1.02%
Pennsylvania 5.22% 1.35% 3.38% 3.46%
Rhode Island 0.56% 0.00% 0.72% 0.03%
South Carolina 0.67% 1.25% 0.20% 0.75%
South Dakota 0.27% 0.00% 0.00% 0.00%
Tennessee 1.58% 0.91% 0.50% 1.19%
Texas 13.90% 15.89% 11.35% 14.12%
Utah 0.00% 0.51% 0.00% 0.99%
Vermont 0.14% 0.00% 0.13% 0.00%
Virginia 1.61% 3.39% 1.64% 2.37%
Washington 3.51% 1.63% 2.12% 0.87%
West Virginia 0.58% 0.00% 0.79% 0.49%
Wisconsin 0.72% 0.75% 1.59% 1.92%
Wyoming 0.24% 0.51% 0.89% 0.00%
Guam 0.41% 0.79% 0.00% 1.60%
Puerto Rico 1.97% 0.90% 2.39% 1.64%
Virgin Islands 0.18% 0.00% 1.71% 0.18%
Total 100.00% 100.00% 100.00% 100.00%

1 Due to state law, residents of California, Illinois, Iowa and Minnesota, are subject to State Income Tax on all income earned by the fund. Please consult your tax advisor for more information.

2 California Residents: The information reported on Form 1099-INT for federal tax-exempt dividends will also be reported to the California Franchise Tax Board.

Foreign Source Income

The information below is provided to help calculate your foreign tax credit, if you are required to file IRS Form 1116.

2011 Foreign Source Income
Fund Foreign Source Income Factor
(Apply to Box 1a of 1099)
Ivy European Opportunities 100.00%
Ivy International Core Equity 100.00%
Ivy International Balanced 97.58%
Ivy Pacific Opportunities 100.00%
Waddell & Reed Advisors International Growth 100.00%

Please note: The IRS no longer requires country by country reporting of income on mutual fund distributions.

Resources and Additional Assistance

TurboTax® and TurboTax for the WebSM
Fund shareholders who are registered for online account access now have the ability to download and import tax information directly into TurboTax.

The software includes the Instant Data Entry feature, which enables automated import of your 1099 investment information directly for your retirement and non-retirement accounts. Once imported, you can download this information directly into your TurboTax return. 1099-B average cost information will not be imported.

H&R Block at HomeTM

Fund shareholders who are registered for online account access now have the ability to download and import tax information directly into H&R Block at Home.

The software includes the Smart Import feature, which enables automated import of your 1099 investment information directly for your retirement and non-retirement accounts. Once imported, you can download this information directly into your H&R Block at Home return. 1099-B average cost information will not be imported.

Duplicate Tax Forms Online

Fund shareholders who are registered for online account access can order a duplicate of any tax form that has been generated for your account for the previous tax year and have it sent to your address of record. Tax forms available include: 1099B, 1099R, 1099DIV, 1099INT, 1099Q, and 5498.

If you have questions about any of the forms you have received please call one of our Client Service Representatives toll free at 1-888-923-3355, Monday through Friday, 7:30 a.m. 7:00 p.m. CST.

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