Introduction

This publication provides information on the tax treatment of investment income and expenses. It includes information on the tax treatment of investment income and expenses for individual shareholders of mutual funds or other regulated investment companies, such as money market

funds. It explains what investment income is taxable and what investment expenses are deductible. It explains when and how to show these items on your tax return. It also explains how to determine and report gains and losses on the disposition of investment property and provides information on property trades and tax shelters.

TIP

The glossary at the end of this publication defines many of the terms used.

Investment income. This generally includes interest, dividends, capital gains, and other types of distributions, including mutual fund distributions.

Investment expenses. These include interest paid or incurred to acquire investment property and expenses to manage or collect income from investment property.

Qualified retirement plans and IRAs. The rules in this publication do not apply to investments held in individual retirement arrangements (IRAs), section 401(k) plans, and other qualified retirement plans. The tax rules that apply to retirement plan distributions are explained in the following publications.

• Pub. 560, Retirement Plans for Small Business.

• Pub. 571, Tax-Sheltered Annuity Plans (403(b) Plans).

• Pub. 575, Pension and Annuity Income.

• Pub. 590-A, Contributions to Individual Retirement Arrangements (IRAs).

• Pub. 590-B, Distributions from Individual Retirement Arrangements (IRAs).

• Pub. 721, Tax Guide to U.S. Civil Service Retirement Benefits.

Comments and suggestions. We welcome your comments about this publication and suggestions for future editions.

You can send us comments through IRS.gov/ FormComments . Or, you can write to the Internal Revenue Service, Tax Forms and Publications, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224.

Although we can’t respond individually to each comment received, we do appreciate your feedback and will consider your comments and suggestions as we revise our tax forms, instructions, and publications. Don’t send tax questions, tax returns, or payments to the above address.

Getting answers to your tax questions. If you have a tax question not answered by this publication or the How To Get Tax Help section at the end of this publication, go to the IRS Interactive Tax Assistant page at IRS.gov/ Help/ITA where you can find topics by using the search feature or viewing the categories listed.

Getting tax forms, instructions, and publications. Go to IRS.gov/Forms to download current and prior-year forms, instructions, and publications.

2 Publication 550 (2025)

Ordering tax forms, instructions, and publications. Go to IRS.gov/OrderForms to order current forms, instructions, and publications; call 800-829-3676 to order prior-year forms and instructions. The IRS will process your order for forms and publications as soon as possible. Don’t resubmit requests you’ve already sent us. You can get forms and publications faster online.