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Selling Mutual Funds

You have determined your financial goals and risk tolerance and — either on your own or with the help of a Financial Advisor — decided to adjust your asset allocation and sell mutual funds that you own. Here are some tips on selling mutual funds.

Selling or Exchanging Mutual Funds
When you sell shares of a mutual fund you own, you sell them at the NAV calculated after the next close of the US stock market minus any applicable sales charges.

You may also have a capital gain or loss in the year you sell the shares, just as you would if you sold individual securities. If you exchange mutual fund shares from one fund to another fund (in the same mutual fund family), it is also considered a sale for tax purposes and may be a taxable event if you own your shares outside of a tax-deferred account.

The amount of gain or loss from a sale is determined by the difference between your "cost basis" of the fund shares (generally, the original purchase price plus an additional sales charges) and the sale price of the shares (minus any additional fees or charges).

(sale price additional fees or charges) (purchase price + additional sales charges) = Cost Basis

Share Classes of Mutual Funds
Some mutual funds issue classes of shares with back-end load structures. The sales structure for fund classes with back-end loads can vary from fund family to fund family. Be sure to check each prospectus for details. Common types of share classes with back-end loads include:


Share Class
Sales Charge or Load Structure
Annual Fees
Waivers for Sales Charges
B
Charged at time of redemption
Generally higher fees than Class A Shares
Generally convert to Class A shares after approximately eight years
C
Charged if redeemed during the first year
Generally highest annual fees
Generally no sales charges after the first year

Taxes
In the January following the tax year in which you sold mutual fund shares from a taxable account, you will receive documents containing information you'll generally need to file with your tax return. These documents include:
  • IRS Form 1099-B: Reports the proceeds from a sale of mutual fund shares during a particular tax year.
  • IRS Form 1099-DIV: Reports any dividends and capital gains distributed during the year.
  • IRS Form 1099-INT: Reports any interest income received.

For more information on types of mutual funds, reviewing historical performance, and buying funds see our additional mutual fund investing articles.



 
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These articles are for information and education purposes only. You will need to evaluate the merits and risks associated with relying on any information provided. Although this article may provide information relating to approaches to investing or types of securities and investments you might buy or sell, Wells Fargo and its affiliates are not providing investment recommendations, advice, or endorsements. Data have been obtained from what are considered to be reliable sources; however, their accuracy, completeness, or reliability cannot be guaranteed. Wells Fargo makes no warranties and bears no liability for your use of this information. The information made available to you is not intended, and should not be construed as legal, tax, or investment advice, or a legal opinion.
Contact Wells Fargo Advisors or your investment professional for a mutual fund's current prospectus, which contains more complete information on investment objectives, charges, fees, risks, and expenses. Please read and consider the information in the prospectus carefully before investing.

Mutual funds available without transaction fees may change at any time without notice. Therefore, any mutual funds purchased without a transaction fee may be subject to a transaction fee for subsequent purchases or upon liquidation.
Wells Fargo Advisors has entered into agreements with certain mutual fund families to share the educational, training, recordkeeping and other costs associated with the sale of mutual fund shares. The sharing of costs can take the form of payments made by the fund families to Wells Fargo Advisors. Wells Fargo Advisors also receives revenue from Wells Fargo Funds Management, LLC, an affiliate of Wells Fargo Advisors, relating to customer assets held by Wells Fargo Advantage Funds. These payments are in addition to the sales charges disclosed in the fee tables found in the prospectuses of the mutual funds of these fund families and Wells Fargo Advantage Funds.
Wells Fargo Advisors, LLC (Member SIPC) does not provide tax or legal advice. Please see your tax and legal advisors to determine how this information may apply to your own situation.
Asset allocation does not ensure or guarantee better performance, and cannot eliminate the risk of investment losses.
Financial Advisors are registered representatives of Wells Fargo Advisors LLC, member SIPC, a non-bank affiliate of Wells Fargo & Company.
Brokerage products and services including WellsTrade are offered through Wells Fargo Advisors. Wells Fargo Advisors is the trade name used by two separate registered broker-dealers: Wells Fargo Advisors, LLC and Wells Fargo Advisors Financial Network, LLC, (Members SIPC), non-bank affiliates of Wells Fargo & Company.