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2022 Tax Year Notification
It’s that time of year! Tax season is in full swing, and Harbor is hard at work to provide you with the necessary forms to file your taxes. Tax information can be found in the Tax Center, which includes 2022 form distribution dates, information on Foreign Tax Credits, Qualified Dividend income, and more. Additional information can be found in the FAQs section on our website too. We strive to provide best-in-class service so please reach out to our Shareholder Services group at 800-422-1050 with any question. Please note that Harbor cannot provide any information that could be misconstrued as tax advice.
Cost Basis
Mutual funds are required to provide cost basis information to shareholders and the Internal Revenue Service (IRS). You should be aware of these regulations and how they will affect the tax reporting on your taxable Harbor Funds accounts.
For more information on Cost Basis and how it may affect you, please visit the Cost Basis frequently asked questions.
Income From U.S. Government Obligations
Year-Ended December 31, 2022
Mutual fund dividends derived from U.S. government securities are exempt from state and local taxes. The table below shows the percentage of the ordinary dividend paid by each Harbor fund in 2022 that was derived from U.S. Treasury and certain Federal Agency obligations. If the fund you own is not listed, it does not qualify for this exemption.
| Fund Name | Percentage of Income Derived from U.S. Government Obligations |
|---|---|
| Harbor All-Weather Inflation Focus ETF | 100.00% |
| Harbor Core Bond Fund | 16.10% |
| Harbor Core Plus Fund | 13.10% |
| Harbor Energy Transition Strategy ETF | 100.00% |
| Harbor Money Market Fund* | 100.00% |
* This fund meets the threshold requirements for California, Connecticut and New York, which require that at least 50% of a fund's assets at each quarter-end within the tax year consist of U.S. government obligations.
The information shown above should not be construed as specific tax, legal or investment advice. If you have questions, please consult with your tax adviser to determine the appropriate use of this information for your tax situation.
Corporate Dividends-Received Deduction
Year-Ended December 31, 2022
The following percentage of each fund's ordinary income dividend (income dividend plus short-term capital gain distribution) qualifies for the federal dividends-received deduction (DRD). To be eligible for the deduction you must be a taxable corporation. Your eligibility for this deduction could be affected by certain provisions of the Internal Revenue Code.
| Fund Name | Percentage Eligible for Dividends-Received Deduction |
|---|---|
| Harbor Convertible Securities Fund | 15.10% |
| Harbor Corporate Culture ETF | 100.00% |
| Harbor Corporate Culture Leaders ETF | 100.00% |
| Harbor Diversified International All Cap Fund | 2.70% |
| Harbor Dividend Growth Leaders ETF | 100.00% |
| Harbor Large Cap Value Fund | 100.00% |
| Harbor Long-Term Growers ETF | 100.00% |
| Harbor Mid Cap Fund | 77.10% |
| Harbor Mid Cap Value Fund | 100.00% |
| Harbor Small Cap Value Fund | 100.00% |
The information shown above should not be construed as specific tax, legal or investment advice. If you have questions, please consult with your tax adviser to determine the appropriate use of this information for your tax situation.
Foreign Tax Credit
Year Ended December 31, 2022
Certain Harbor funds paid foreign taxes that can be passed through to shareholders. As a shareholder, you may be entitled to claim a foreign tax credit or take an itemized deduction on your federal income tax return for such amounts. Depending on your individual situation, you may be required to file Foreign Tax Credit Form 1116 (Individual, Estate or Trust) or Form 1118 (Corporation).
Shareholders completing Form 1116 are no longer required to report foreign taxes paid on a country-by-country basis; simply enter "RIC" on line i.
To calculate your total income from foreign sources paid by the fund, multiply the amount in Box 1a of your 1099-DIV by the percentage found in the column below titled "Percent of Box 1a That is Foreign Sourced Income". You may be required to adjust foreign sourced income by any foreign sourced qualified dividend income. The percent of Box 1a which is foreign sourced qualified dividend income may be found in the table titled, "Percent of Box 1a that is Foreign Sourced qualified dividend income." For more information, please see Instructions to Form 1116 and IRS Publication 514, Foreign Tax Credit for Individuals.
| Fund Name | Percent of Box 1a That is Foreign Sourced Income | Percent of Box 1a That is Foreign Sourced Qualified Dividend Income |
|---|---|---|
| Harbor Diversified International All Cap Fund | 100.00% | 100.00% |
| Harbor Emerging Markets Equity Fund | 100.00% | 72.40% |
| Harbor International Growth Fund | 100.00% | 100.00% |
| Harbor International Small Cap Fund | 90.50% | 90.50% |
| Harbor Overseas Fund | 99.20% | 87.60% |
The information shown above should not be construed as specific tax, legal or investment advice. If you have questions, please consult with your tax adviser to determine the appropriate use of this information for your tax situation.
Qualified Dividend Income
Year Ended December 31, 2022
The following percentage of each fund's ordinary income dividend (income dividend plus short-term capital gain distribution) is eligible for reduced tax rates as qualified dividend income (QDI) for 2022.
| Fund Name | QDI Percentage |
|---|---|
| Harbor Convertible Securities Fund | 15.10% |
| Harbor Corporate Culture ETF | 100.00% |
| Harbor Corporate Culture Leaders ETF | 100.00% |
| Harbor Diversified International All Cap Fund | 100.00% |
| Harbor Dividend Growth Leaders ETF | 100.00% |
| Harbor Emerging Markets Equity Fund |
81.00% |
| Harbor International Compounders ETF | 100.00% |
| Harbor International Fund |
95.90% |
| Harbor International Growth Fund |
100.00% |
| Harbor International Small Cap Fund |
100.00% |
| Harbor Large Cap Value Fund |
100.00% |
| Harbor Long-Term Growers ETF | 100.00% |
| Harbor Mid Cap Fund |
78.20% |
| Harbor Mid Cap Value Fund |
100.00% |
| Harbor Overseas Fund |
87.60% |
| Harbor Small Cap Value Fund |
100.00% |
The information shown above should not be construed as specific tax, legal or investment advice. If you have questions, please consult with your tax adviser to determine the appropriate use of this information for your tax situation.
163(j) Interest Dividends
Year-Ended December 31, 2022
Taxable corporations or partnerships may use the following percentage of each fund's ordinary income dividend (income dividend plus short-term capital gain distribution) as business interest income for purposes of calculating certain provisions of the Internal Revenue Code.
| Fund Name | Ordinary Income Dividend Percentage |
|---|---|
| Harbor All-Weather Inflation Focus ETF | 100.00% |
| Harbor Convertible Securities Fund | 78.00% |
| Harbor Core Bond Fund | 89.40% |
| Harbor Core Plus Fund | 100.00% |
| Harbor Energy Transition Strategy ETF | 100.00% |
| Harbor High-Yield Bond Fund | 88.60% |
| Harbor Money Market Fund | 100.00% |
| Harbor Scientific Alpha High-Yield ETF | 93.40% |
| Harbor Scientific Alpha Income ETF | 83.70% |
The information shown above should not be construed as specific tax, legal or investment advice. If you have questions, please consult with your tax adviser to determine the appropriate use of this information for your tax situation.
2795200
Forms 8937
Organizational actions (e.g. return of capital) affecting the basis of securities held in Harbor Funds are reported on IRS Form 8937.
