Tax Information
| Record Date | Retained capital gains per share | Federal income taxes paid per share | Increase in tax basis per share |
|---|---|---|---|
| Mar 31, 1968 | $0.5041 | $0.1292 | $0.3749 |
| Mar 31, 1969 | $0.3102 | $0.0852 | $0.2250 |
| Mar 31, 1970 | $0.2366 | $0.0662 | $0.1704 |
| Mar 31, 1983 | $1.2106 | $0.3390 | $0.8716 |
| Mar 31, 1984 | $0.1797 | $0.0503 | $0.1294 |
| Mar 31, 1985 | $0.3469 | $0.0971 | $0.2498 |
| Dec 31, 1986 | $3.2523 | $0.9106 | $2.3417 |
| Dec 31, 1989 | $3.2378 | $1.1008 | $2.1370 |
| Dec 31, 1991 | $5.9375 | $2.0187 | $3.9188 |
| Dec 31, 1992 | $2.0823 | $0.7080 | $1.3743 |
| Dec 31, 1996 | $4.7546 | $1.6641 | $3.0905 |
| Dec 31, 1997 | $4.9821 | $1.7437 | $3.2384 |
| Dec 31, 1998 | $0.2001 | $0.0700 | $0.1301 |
| Dec 31, 1999 | $3.0474 | $1.0666 | $1.9808 |
| Dec 31, 2005 | $3.5761 | $1.2516 | $2.3245 |
| Dec 31, 2006 | $8.1469 | $2.8514 | $5.2955 |
| Dec 31, 2008 | $3.9883 | $1.3959 | $2.5924 |
| Dec 31, 2009 | $0.622 | $0.2177 | $0.4043 |
| Dec 31, 2010 | $18.7106 | $6.5487 | $12.1619 |
| Dec 31, 2011 | $0.9504 | $0.3326 | $0.6178 |
| Dec 31, 2012 | $0.8478 | $0.2967 | $0.5511 |
For Shareholders on December 31, 2012
We met the applicable requirements of the Internal Revenue Code for federal income tax treatment as a regulated investment company. Shareholders should consider the following when preparing 2012 tax returns:
Cash Dividends
IRS Form 1099 reflects the $0.40 per share dividend paid on May 31, 2012, and the $0.40 per share dividend paid on November 30, 2012, which are qualified dividends and taxable at a maximum rate of 15% for individuals, estates or trusts. During the year ended December 31, 2012, we distributed capital gain dividends in the amount of $17.59 per share to our shareholders.
Retained Long-Term Capital Gains
During the year ending December 31, 2012, we realized taxable long-term capital gains of $3,214,547 ($0.8478 per share) and will pay federal income taxes of 35%, equivalent to $1,125,092 ($0.2967 per share). We elected to retain these gains and, as a regulated investment company, designated them to shareholders of record on December 31, 2012. The tax effect is the same as if the capital gains had been distributed to our shareholders, who then elected to reinvest 65% of the amount received. The 35% capital gains tax paid by Capital Southwest is considered to have been paid on behalf of the shareholders.
For Shareholders from 1968 through 2012
In certain years from 1968 through 2012, we made elections to retain taxable net long-term capital gains. The table shows the record dates for all years for which we made such elections and the per share amounts of the retained long-term capital gains, the federal income taxes paid and the amounts by which shareholders on each record date are entitled to increase the tax basis of each share (adjusted for stock splits in 1976, 1981 and 1987).
