amounts to the amounts that were reported to them on 1099 filings and if the numbers don't match, they adjust your return.

You will pay capital gains when you sell your Mutual Fund shares. Mutual Funds should act like a DRIP, in that the income on which you pay taxes while you own it increases your basis. So, if you bought the shares initially for $1,000 and then paid tax on $500 of interest, dividends, and capital gains distributions for several years before selling it for $1,700, you would pay tax on $200 of capital gains (1700-(1000+500)). A portion of those capital gains would be short-term and a portion would be long-term.
[Post edited by Hokie CPA at 05/13/2021 09:02AM]