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I received a long-term capital gain on a tax-exempt bond fund and it's not qualified so it's taxed at the 15% rate. Since I'am in the 15% tax bracket, I thought the rate was 5% ..... is it because it is a bond? Any help woild be great! THANKS!

Yes. In order for the capital gain distribution to "qualify", two things have to happen. 1) You have to own the shares in the fund long-enough for the distribution to qualify, and 2) The investment which generated the capital gain (the bonds in this case) must "qualify" when considered from the perspective of the fund's ownership of it.

In your specific case, investment in a bond is never an investment which yields "qualified" dividends. So bond fund distributions are not qualified either.

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