Closed-end tax guide
Preparing federal and state income tax returns can be challenging, but Invesco helps make this process easier by providing the information you need in a clear, concise, and timely manner. This guide is a summary of useful information for Invesco closed-end funds and was created using the most recent information available. Please be aware that this guide isn't meant to replace the assistance or advice of a tax professional. However, we hope that it will help you better organize and understand the portion of your income tax return that involves your Invesco closed-end investments. Additional questions? Contact us at the phone numbers below.
Important tax form information
The links below provide more detailed information on each of the tax forms that you may have received as well as important dates. To find relevant tax forms, log in to your account or reach out to us.
| IRS form | Information reported | Available by date* |
|---|---|---|
| Form 1099-B | Redemption proceeds and cost basis associated with the sale or exchange of fund shares for nonretirement accounts of price-fluctuating funds | February 15 for most funds |
| Form 1099-DIV | Dividends, including capital gains, exempt-interest, and other fund distributions, from nonretirement accounts | February 15 for most funds |
| Form 1042-S | Distributions and taxes withheld for accounts owned by nonresident aliens and foreign entities | March 15 |
*If a referenced date falls on a weekend or holiday, then delivery will generally occur on the next available business day.
Tax resources
See below to access comprehensive tax resources tailored for closed-end funds.
| Name | Description | Documents |
|---|---|---|
| Tax insert (including state/territory-exempt dividends) | Identifies tax-exempt income by state |
|
| Primary distribution file | This document contains information that will assist financial intermediaries with preparing IRS Form 1099-DIV and 1099-B for payees. The document includes tax information specific to the distribution of dividends, capital gains, foreign tax paid, alternative minimum tax (AMT), and return of capital. | 2023 Common Shares 2023 Preferred Shares |
| Secondary distribution file | This document contains more information that will assist financial intermediaries with preparing IRS Form 1099-DIV and other tax related materials for payees. This document additionally includes tax information specific to federal obligations, foreign source income, and U.S. State/Territory specific reporting. | 2023 |
This document provides the estimated dividend record, ex date and payable dates for applicable funds in the current year.
If you received Form 1099-DIV, a portion of your distributions is subject to federal income tax. These distributions are taxed as follows:
Ordinary dividends can be found in Box 1a of Form 1099-DIV. This amount represents any taxable income earned on securities held by your fund, as well as any net short-term capital gains that were distributed to shareholders. If you participated in the dividend reinvestment plan and shares were purchased at a discount to the market price, this amount will also reflect the value of this discount. Ordinary dividends are taxed at your ordinary income rate. Qualified dividends shown in Box 1b reflect the portion that may be eligible for a reduced capital gains rate.
About Form 1040, U.S. Individual Income Tax Return | Internal Revenue Service (irs.gov)
About Form 1040-A, U.S. Individual Income Tax Return | Internal Revenue Service (irs.gov)
Total capital gains distributions can be found in Box 2a of Form 1099-DIV. This amount reflects any long-term capital gains distributed by your fund. Long-term capital gains are recognized on securities held in the fund's portfolio for more than one year before being sold.
Federal alternative minimum tax (AMT) and income from government obligations.
In addition to its exemption from federal income taxes, a portion of your tax-exempt income may be free from state and local income taxes, depending on the tax laws of your state or local taxing authority. If you own one of Invesco's national tax-exempt funds, the percentage of your fund's tax-exempt income by state is located below under Federal Alternative Minimum Tax - National Funds. Tax-exempt income is reported in Box 12 on Form 1099-DIV and income subject to federal AMT is reported in Box 13.
Please consult your tax advisor to determine whether you are eligible for state tax exemption for this portion of your fund's income.
Fund name |
Symbol |
Invesco Value Municipal Income Trust |
IIM |
Invesco Municipal Income Opportunities Trust |
OIA |
Invesco Quality Municipal Income Trust |
IQI |
Invesco Advantage Municipal Income Trust II |
VKI |
Invesco Municipal Opportunity Trust |
VMO |
Invesco Municipal Trust |
VKQ |
Invesco Trust For Investment Grade Municipals |
VGM |
Most states do not tax interest derived from US government obligations. However, states vary in the definition of federal interest, and certain states have special requirements. States vary on treatment of these dividends. The table below shows the percentage of ordinary income dividend on your Form 1099-DIV derived from federal obligations.
Tax Year 2023
| Fund Name | U.S. Treasury | Farm Credit | Fed Home Loan Bank | SLMA | Tennessee Valley | Other Direct Federal | Percentage of Income from Exempt Federal Securities |
|---|---|---|---|---|---|---|---|
| Invesco Bond Fund | 2.68% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 2.68% |
| Invesco High Income Trust II | 0.01% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.01% |
| Invesco High Income 2023 Target Term Fund | 1.37% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 1.37% |
| Invesco High Income 2024 Target Term Fund | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Tax Year 2023
| Fund | Primary State |
Other U.S. Territories* | Other | AMT%** |
|---|---|---|---|---|
| Invesco California Value Municipal Income Trust (VCV) | 96.05 | 3.95 | 0.00 | 11.8049% |
| Invesco Pennsylvania Value Municipal Income Trust (VPV) | 91.23 | 8.52 | 0.25 | 8.2175% |
| Invesco Trust for Investment Grade New York Municipals (VTN) | 97.05 | 2.95 | 0.00 | 9.2754% |
For shareholders in the funds listed below, the information to complete your tax return can be found on Form 1099-DIV. You do not need any additional information about your fund's income sources.
Fund name |
Symbol |
Invesco Bond Fund |
VBF |
Invesco Dynamic Credit Opportunities |
VTA |
Invesco High Income Trust II |
VLT |
Invesco Senior Income Trust |
VVR |
Information related to corporate actions, including items such as mergers, fund liquidations, and reclassifications that impact cost basis reporting.
- Invesco Advantage Municipal Income Trust II1: 2019, 2020, 2023, 2024
- Invesco California Value Municipal Income Trust1: 2019, 2020, 2023, 2024
- Invesco Dynamic Credit Opportunities Fund: 2016, 2017, 2018, 2021
- Invesco High Income 2023 Target Term Fund: 2021, 2023
- Invesco High Income Trust II: 2016, 2017, 2019, 2020, 2021, 2023
- Invesco Municipal Opportunity Trust1: 2019, 2020, 2023, 2024
- Invesco Municipal Income Opportunities Trust: 2023, 2024
- Invesco Municipal Trust1: 2019, 2020, 2023, 2024
- Invesco Pennsylvania Value Municipal Income Trust1: 2023, 2024
- Invesco Quality Municipal Income Trust: 2021, 2023
- Invesco Senior Income Trust1: 2017, 2018, 2021, 2023, 2024
- Invesco Trust for Investment Grade Municipals1: 2019, 2020, 2023, 2024
- Invesco Trust for Investment Grade New York Municipals1: 2019, 2020, 2023, 2024
- Invesco Value Municipal Income Trust: 2019, 2020, 2023, 2024
1 Effective Dec. 3, 2012, Van Kampen was removed from the fund name.
The links below provide estimates of each open-end fund's current distributions.
- Invesco Advantage Municipal Income Trust II: Feb, Apr, May, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Bond Fund: Nov
- Invesco California Value Municipal Income Trust: Jul, Aug, Sep, Oct, Nov
- Invesco High Income Trust II: Jan, Feb, Mar, Apr, May, Jul, Aug, Sep, Oct
- Invesco Municipal Income Opportunity Trust: Jan, Feb, Mar, Apr, May, Jun, Jul, Aug, Sep
- Invesco Municipal Opportunity Trust: Apr, May, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Municipal Trust: Feb, Apr, May, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Pennsylvania Value Municipal Income Trust: Feb, Jun, Jul, Aug, Sep, Oct, Nov,
- Invesco Senior Income Trust: Jan, Feb, Mar, May, Jul, Aug, Sep, Oct
- Invesco Trust for Investment Grade Municipals: May, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Trust for Investment Grade New York Municipals: Feb, Mar, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Quality Municipal Income Trust: Feb, Apr, May, Jun, Jul, Aug, Sep, Oct, Nov
- Invesco Value Municipal Income Trust: Feb, Apr, May, Jun, Jul, Aug, Sep, Oct, Nov
Fund characteristics are subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned or securities in the sectors shown above. Credit quality and credit allocation are shown as a percentage of total net assets. Sectors are shown as a percentage of long-term investments. Securities are classified by sectors that represent broad groupings of related industries. Credit quality allocations based upon ratings as issued by Standard and Poor's and Moody's, respectively. This data is provided for informational purposes only and is not intended for trading or selling purposes. Closed end funds, unlike open end funds, are not continuously offered. There is a one time public offering and once issued, shares of closed end funds are sold in the open market.There is no assurance that a closed end fund will achieve its investment objective. Like any stock, a closed end fund's share price will fluctuate with market conditions and other factors. At the time of sale, your shares may have a market price that is above or below net asset value, and may be worth more or less than your original investment. Accordingly, it is possible to lose money investing in the Trust. These funds are subject to credit and interest-rate risk. Credit risk refers to the ability of an issuer to make timely payments of interest and principal. Investments in securities rated below investment grade present greater risk of loss to principal and interest than investment in higher-quality securities. Interest-rate risk refers to fluctuations in the value of a fixed-income security resulting from changes in the general level of interest rates. In a declining interest-rate environment, the portfolio may generate less income. In a rising interest-rate environment, bond prices fall. Should the funds employ leverage, the portfolios may experience increased volatility.
- Invesco Advantage Municipal Income Trust II: Feb, Apr, May, Jun, Aug, Oct
- Invesco Bond Fund: Jan, May, Jun, Jul, Dec
- Invesco High Income Trust II: Jan, Feb, Mar, Apr, May, Jun, Jul, Aug, Sep, Nov, Dec
- Invesco Municipal Income Opportunity Trust: Jan, Feb, May, Jun, Oct, Nov, Dec
- Invesco Municipal Opportunity Trust: Feb, Apr, May, Aug, Oct, Nov, Dec
- Invesco Municipal Trust: Feb, Apr, May, Jun, Aug, Oct, Dec
- Invesco Pennsylvania Value Municipal Income Trust: Mar, May, Jul, Oct, Dec
- Invesco Senior Income Trust: May, Jun, Nov, Dec
- Invesco Trust for Investment Grade Municipals: Feb, Mar, May, Jun, Aug, Oct, Dec
- Invesco Trust for Investment Grade New York Municipals: Feb
- Invesco Quality Municipal Income Trust: Feb, Oct, Dec
- Invesco Value Municipal Income Trust: Feb, Apr
Fund characteristics are subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned or securities in the sectors shown above. Credit quality and credit allocation are shown as a percentage of total net assets. Sectors are shown as a percentage of long-term investments. Securities are classified by sectors that represent broad groupings of related industries. Credit quality allocations based upon ratings as issued by Standard and Poor's and Moody's, respectively. This data is provided for informational purposes only and is not intended for trading or selling purposes. Closed end funds, unlike open end funds, are not continuously offered. There is a one time public offering and once issued, shares of closed end funds are sold in the open market.There is no assurance that a closed end fund will achieve its investment objective. Like any stock, a closed end fund's share price will fluctuate with market conditions and other factors. At the time of sale, your shares may have a market price that is above or below net asset value, and may be worth more or less than your original investment. Accordingly, it is possible to lose money investing in the Trust. These funds are subject to credit and interest-rate risk. Credit risk refers to the ability of an issuer to make timely payments of interest and principal. Investments in securities rated below investment grade present greater risk of loss to principal and interest than investment in higher-quality securities. Interest-rate risk refers to fluctuations in the value of a fixed-income security resulting from changes in the general level of interest rates. In a declining interest-rate environment, the portfolio may generate less income. In a rising interest-rate environment, bond prices fall. Should the funds employ leverage, the portfolios may experience increased volatility.
- Invesco Advantage Municipal Income Trust II: Feb, Mar, Jun, Jul, Aug, Oct, Nov, Dec
- Invesco Bond Fund: Aug, Oct, Dec
- Invesco High Income Trust II: Jan, Mar, Apr, May, Jun, Jul, Aug, Sep, Oct, Nov, Dec
- Invesco Municipal Income Opportunity Trust: May, Jun, Jul, Oct, Nov, Dec
- Invesco Municipal Opportunity Trust: Feb, Mar, May, Jun, Jul, Aug, Sep, Oct, Dec
- Invesco Municipal Trust: Jan, Feb, Mar, May, Jun, Aug, Sep, Oct, Dec
- Invesco Pennsylvania Value Municipal Income Trust: May, Jun, Jul, Sep, Oct, Dec
- Invesco Senior Income Trust: May, Jun, Dec
- Invesco Trust for Investment Grade Municipals: Jan, Feb, Mar, May, Jun, Jul, Sep, Oct, Dec
- Invesco Trust for Investment Grade New York Municipals: Dec
- Invesco Quality Municipal Income Trust: Jan, Mar, Jun, Jul, Aug, Oct
- Invesco Value Municipal Income Trust: Oct, Dec
Fund characteristics are subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned or securities in the sectors shown above. Credit quality and credit allocation are shown as a percentage of total net assets. Sectors are shown as a percentage of long-term investments. Securities are classified by sectors that represent broad groupings of related industries. Credit quality allocations based upon ratings as issued by Standard and Poor's and Moody's, respectively. This data is provided for informational purposes only and is not intended for trading or selling purposes. Closed end funds, unlike open end funds, are not continuously offered. There is a one time public offering and once issued, shares of closed end funds are sold in the open market.There is no assurance that a closed end fund will achieve its investment objective. Like any stock, a closed end fund's share price will fluctuate with market conditions and other factors. At the time of sale, your shares may have a market price that is above or below net asset value, and may be worth more or less than your original investment. Accordingly, it is possible to lose money investing in the Trust. These funds are subject to credit and interest-rate risk. Credit risk refers to the ability of an issuer to make timely payments of interest and principal. Investments in securities rated below investment grade present greater risk of loss to principal and interest than investment in higher-quality securities. Interest-rate risk refers to fluctuations in the value of a fixed-income security resulting from changes in the general level of interest rates. In a declining interest-rate environment, the portfolio may generate less income. In a rising interest-rate environment, bond prices fall. Should the funds employ leverage, the portfolios may experience increased volatility.
Frequently asked questions
Explore the additional frequently asked topics regarding close-end tax forms.
Although most income distributions from your tax-exempt fund are not subject to regular federal income taxes, there are some instances in which you will receive some taxable income:
- Mutual funds and other regulated investment companies are required to report exempt-interest dividends in Box 11 of Form 1099-DIV
- Your fund paid a capital gain.
- Your fund was required to recognize taxable income on securities purchased at a discount.
- Your participation in the fund's dividend reinvestment plan generated discount income (the difference between the discounted purchase price and the market price of reinvested shares is taxable). This amount is included in Box 1a (total ordinary income) on Form 1099-DIV.
Yes. Income from taxable funds and all capital gain distributions are taxable, regardless of whether you receive them in cash or reinvest them in additional fund shares. You should keep a record of the amount of dividends reinvested because this will increase your cost basis in the fund's shares. By keeping track of reinvested dividends, you'll be able to determine the correct taxable gain or loss when you redeem or exchange your fund shares.
Under current tax law, the taxable income shown on Form 1099-DIV must include distributions for the year in which they are declared, even if the distribution isn't actually received until January of the following calendar year.
A qualified dividend is paid to the fund by a "qualified" company. This is defined as a domestic company traded on a qualifying exchange or a foreign company where the country of origin has a comprehensive income tax treaty with the US that includes an exchange of information program. There is also a holding period requirement that must be met for a dividend to be deemed qualified. Qualified dividends may be eligible for a reduced tax rate.
If your fund's manager purchased securities and later sold them for more than the purchase price, your fund earned capital gains. These gains are distributed to shareholders during the year. If you received a capital gain distribution during the year, you will be required to pay taxes on that amount, regardless of whether you received it in cash or reinvested it in additional shares. The capital gains amount can be found on Form 1099-DIV.
Yes. Capital gains are generally taxed at a lower rate than ordinary income.
Certain states have special exemptions for income earned from US government securities and tax-free municipal securities issued in that state. You can find an income breakdown by state for your fund inside this tax insert, which should help you identify any income that may be tax-exempt in your state. Consult your tax advisor or state tax agency about the specific rules in your state.
Federal law generally requires us to withhold 24% of any distribution or redemption if we do not have a correct and certified Social Security or taxpayer identification number for your account. The IRS tells us which Social Security or taxpayer identification numbers are not correct or certified and requires us to perform this withholding. The withholding amount shown on your 1099 forms should be reported as "federal income tax withheld" on your federal income tax return.
The following income will be reported on Form 1099-DIV in accordance with IRS instruction:
- Exempt-interest dividend
- Specified private activity bond interest dividend
Computershare will report sales price less commissions and options premiums.
For your protection, Invesco will mask the first five digits of your Social Security number, and it will read in the format XXX-XX-1234. Please note that accounts in an employee identification number or taxpayer identification number format may not be masked.
At Invesco, we know even small steps make an impact. By reducing the amount of printed materials you receive, you can help protect the environment. Additionally, you will enjoy fast and easy portfolio management and the convenience of viewing your materials online.
Consider taking these simple steps to reduce your ecological footprint. With a click of the mouse you can:
- Obtain electronic tax forms
- Update banking details
- Certify your tax status
- Impact the environment
Going green is fast and easy. To sign up for electronic communications, log into the closed-end account access Investor Center.
As part of the Energy Improvement and Extension Act of 2008, mutual fund companies are required to report your cost basis information on IRS Form 1099-B for shares that were acquired and subsequently redeemed on or after Jan. 1, 2012. The default cost basis method for all closed-end funds is first in–first out (FIFO), unless you as the shareholder elect another method.
The backup withholding rate is currently 24%.
Contact us for more information
If you have questions about any of the forms you've received from Invesco, please call one of our Client Services representatives toll-free at (800) 341-2929, Monday - Friday, 7:30am to 4:30pm CST or visit the IRS website. For duplicate forms, access account balances, perform transactions, and more visit the closed-end account access Investor Center.
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