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Reinvested dividends

This isn't actually a tax assumption, but it is a significant calculation that can save you a bundle. And this is the break that previous Internal Revenue Service commissioner Fred Goldberg told Kiplinger's that a lot of taxpayers overlook.

Arkansas State Tax Extension

If, like the majority investors, your mutual fund dividends are routinely used to buy extra shares, keep in mind that each reinvestment amplifies your tax basis in the fund. That, in turn, decrease the taxable capital gain (or increases the tax-saving loss) when you redeem shares. Forgetting to comprise the reinvested dividends in your basis results in double taxation of the dividends -- once when they were paid out and without delay reinvested in more shares and later when they're included in the proceeds of the sale. Don't make that expensive mistake.

If you're not sure what your basis is, inquire the fund for help. (Starting with sales in 2012, mutual funds must report to investors -- and the IRS -- the tax basis of shares redeemed during the year. But note this: The new rule applies only to shares purchased in 2012 and later years. If you redeemed shares you purchased prior to 2012, it's still up to you to figure your basis. Don't forget those reinvested dividends!)

Here we also provide Free Tax Calculator 2013 for easily calculate your income taxes.