The Oakmark Funds are advised by Harris Associates L.P. an autonomous subsidiary of Natixis Investment Managers, L.P.

Learn more about the principles and philosophy behind our funds at HarrisAssoc.com.

Harris Associates

111 South Wacker Drive, Suite 4600
Chicago, Illinois 60606
312-646-3600

FAQs

Find answers quickly to some of our shareholders’ most common questions.

Transactions

How do I purchase Fund shares?

You can purchase shares in one of the following ways:

  • Open a new account online or complete a New Account Form.
  • Buy additional shares online, by phone or by mail.
    • You must have bank instructions to purchase online or by phone. Bank instructions can be established online (if the Oakmark and bank registrations match) or by completing a Shareholder Services Form. Please note that we require a Medallion Signature Guarantee if you are adding or changing bank information by mail.
    • To make additional investments by mail, complete the investment slip attached at the bottom of your statements and mail it along with your check. If you do not have a slip, include a letter of instruction containing your purchase instructions and account information.
    • To purchase by wire, instruct your bank to transfer funds to State Street Bank & Trust Company, ABA#011000028, DDA# 9904-632-8. Specify the Fund name, account number and account registration in the instructions.
    • Make systematic purchases through an automatic investment plan (AIP) or payroll deduction. You can establish an AIP online or complete the Shareholder Services Form.
  • Add a new Oakmark Fund to your existing account online or complete the Add-A-Fund Form.
How do I redeem Fund shares?

We require a Medallion Signature Guarantee (MSG) stamp if redemption proceeds are:

  • Greater than $100,000.
  • To be sent to a bank account that is not on file or was added online within the last 60 days.
  • To be sent to the address on file that has changed within the last 15 days.
  • To be made payable or mailed to someone other than the account owner(s).

You can redeem shares online, by phone or by mail:

  • You may choose to receive proceeds by check, automated clearing house (ACH) transfer or wire ($5 fee).
  • Add bank information online by going to the Account Profile tab. You may also complete the Shareholder Services Form.
    • Please note that we require a Medallion Signature Guarantee if you are adding bank information by mail or requesting to redeem to a bank that was added online within the last 60 days.
    • If you provided a Medallion Signature Guarantee when bank information was added to your account, or have made recent changes to your automatic investment or withdrawal plans and you wish to redeem within 60 days, please submit your request by phone or mail.
  • Complete the Redemption Request Form to redeem from your regular account by mail. For IRA accounts, send the IRA Distribution Form.
  • Set up a plan online to redeem systematically by selecting Add/Edit Automatic Transactions on the Buy/Sell tab. You can also complete the Shareholder Services Form or IRA Distribution Form.
How do I exchange Fund shares?

An exchange transaction is a redemption of shares in one fund and a simultaneous purchase of shares in another fund that, for tax purposes, may result in a capital gain or loss.

You can exchange shares online, by phone or by mail:

  • To exchange by mail, complete the Redemption Request Form and request your redemption proceeds be exchanged to another Oakmark Fund.
  • If your investment meets the minimum requirement for another share class of the same Fund, please request the exchange by phone or submit your request in writing as this function cannot be performed online. Share class exchanges are generally not taxable.
How do I gift Fund shares?

If you are gifting shares to a shareholder or entity who owns or wants to establish a direct account, please complete the Change of Registration Form.

If you are gifting shares to a charitable organization, please contact the organization for instructions and paperwork.

Account Maintenance

How can I go paperless?

You will be prompted to enroll in e-delivery as part of the online login process if we do not have an email address on file for you. You can also enroll online by going to the Account Profile page and selecting E-delivery and Email Address.

How do I change account ownership?

To change your account ownership (e.g., from an individual account to a joint account), you must complete the Change of Registration Form. A Medallion Signature Guarantee is required.

To change your name on your account, please send us the Shareholder Services Form.

How do I add or update bank information?

To add bank information to your account online, select Bank Information under the Account Profile tab on the main navigation ribbon. You may also complete and mail the Shareholder Services Form. Please note that we require a Medallion Signature Guarantee if you are adding bank information by mail or requesting to redeem to a bank that was added online within the last 60 days. If you provided a Medallion Signature Guarantee when bank information was added to your account, or have made recent changes to your automatic investment or withdrawal plans and you wish to redeem within 60 days, please submit your request by phone or mail.

How do I change my address or phone number?

You can update your contact information in one of the following ways:

  • OnlineLogin and choose Address and Phone under the Account Profile tab
  • By Phone – Call 1-800-OAKMARK (625-6275) to speak with an Investor Service Representative
  • By Mail – Send the Shareholder Services Form

It is important to communicate any address changes to us for fraud prevention purposes and to avoid escheatment. In the event of an address change, we will mail a confirmation to your old and new addresses. A Medallion Signature Guarantee is required if you wish to redeem shares to your address of record within 15 days of an address change.

How do I add or change beneficiaries?

To add or change beneficiaries on an IRA or Coverdell Education Savings Account (ESA), please complete the IRA/ESA Beneficiary Designation Form.

For new individual or joint accounts, please submit the Transfer on Death (TOD) Form along with the New Account Registration Form.

For existing individual or joint accounts, please complete the Transfer on Death (TOD) Form.

Beneficiaries cannot be added to a trust account. Your trust documentation should designate successor trustees.

How do I transfer an account due to death?

Please complete the Change of Registration Form to transfer from an individual, joint tenant or TOD account.

To distribute IRA assets, each beneficiary must complete and submit the IRA Distribution Form.

We do not require a certified copy of the death certificate; however, we do require a Medallion Signature Guarantee stamp certifying that the signature is genuine and has legally binding authority.

How do I transfer my retirement assets?

Complete the IRA Application & Adoption Agreement and the IRA Transfer/Direct Rollover of Assets Form to transfer IRA assets from another IRA custodian or rollover retirement plan assets to a new Oakmark IRA.

Submit only the IRA Transfer/Direct Rollover of Assets Form if you are transferring IRA assets from another IRA custodian or rolling over retirement plan assets to an existing Oakmark IRA.

Oakmark will initiate the transfer directly with your current custodian or plan administrator by sending the transfer form and our Letter of Acceptance to act as the new custodian of your IRA assets.

To transfer IRA assets from Oakmark to another IRA custodian, please contact the new custodian to determine what paperwork they require. Transfer paperwork submitted to Oakmark does not need a Medallion Signature Guarantee; however, it should contain acceptance language or be accompanied by a letter of acceptance.

General Information

What are your fees?

The Oakmark Funds are no-load funds, which means shares are sold without a commission or sales charge.

Each Fund’s annual operating expenses (expenses that you pay each year as a percentage of the value of your investment) can be found on the individual Fund pages.

IRA accounts have the following fees:

  • One-Time Setup Fee: $5.00 per Fund account
  • Annual Maintenance Fee: $10.00 per Fund account, maximum of $20.00 per Social Security Number

Coverdell Education Savings Accounts have the following fees:

  • One-Time Setup Fee: $5.00 per Fund account
  • Annual Maintenance Fee: $7.00 per Fund account, maximum of $14.00 per Social Security Number
What is the open/close status of the Funds?

All of the Oakmark Funds are open provided you meet the minimum initial investment requirement. For more information on Fund minimums, please visit Investing with Us.

What is a Medallion Signature Guarantee?

A Medallion Signature Guarantee is a way to protect shareholders against fraud. The Medallion Signature Guarantee stamp certifies the signature is genuine and has legally binding authority. You can obtain a Medallion Signature Guarantee stamp from most commercial banks, trust companies, savings associations, credit unions and member firms of domestic stock exchanges. A notary public cannot provide a Medallion Signature Guarantee.

A Medallion Signature Guarantee (MSG) stamp is required if:

  • You are adding bank information by mail.
  • You wish to redeem more than $100,000.
  • You are changing your account registration (e.g., individual account to joint account).
  • You are transferring an account or distributing account assets due to death.
  • Redemption proceeds are to be sent to the address on file that has changed within the last 15 days.
  • Redemption proceeds are to be made payable or mailed to someone other than the account owner(s).
  • Redemption proceeds are to be sent to a bank account that is not on file or was added online within the last 60 days.
What is the difference between share classes?

The Oakmark Funds offer four share classes to meet the unique needs of the mutual fund marketplace: Investor Class, Advisor Class, Institutional Class and Service Class.

Investor, Advisor and Institutional Classes are available to purchase directly and through certain financial intermediaries. To purchase directly, you must meet—and maintain—a minimum investment of $1,000 for most Investor share accounts, $100,000 for Advisor shares and $1,000,000 for Institutional shares. To review all minimum requirements, please visit Investing with Us. Oakmark will periodically examine shareholder Fund accounts held directly to determine eligibility for conversion. If you are eligible and want to exchange today, please call us at 1-800-OAKMARK (625-6275).

Service shares are offered to certain retirement plans, such as 401(k) and profit sharing plans. If you are a holder of Service Class shares, your 401(k) or other retirement plan will provide shareholder services to you as required in accordance with your plan agreement. You should contact your plan sponsor or service provider for information about the services available to you under the terms of your plan.

Please visit Fund Performance pages or the most recent prospectus to view the latest expense ratios for all share classes of the Oakmark Funds.

Fund Name Class CUSIP Ticker
Oakmark Fund Institutional 413838780 OANMX
Advisor 413838798 OAYMX
Investor 413838103 OAKMX
Service 413838707 OARMX
Oakmark Select Fund Institutional 413838699 OANLX
Advisor 413838715 OAYLX
Investor 413838608 OAKLX
Service 413838806 OARLX
Oakmark Equity and Income Fund Institutional 413838764 OANBX
Advisor 413838772 OAYBX
Investor 413838400 OAKBX
Service 413838871 OARBX
Oakmark Global Fund Institutional 413838673 OANGX
Advisor 413838681 OAYGX
Investor 413838830 OAKGX
Service 413838848 OARGX
Oakmark Global Select Fund Institutional 413838749 OANWX
Advisor 413838756 OAYWX
Investor 413838822 OAKWX
Service 413838814 OARWX
Oakmark International Fund Institutional 413838723 OANIX
Advisor 413838731 OAYIX
Investor 413838202 OAKIX
Service 413838863 OARIX
Oakmark Intl. Small Cap Fund Institutional 413838657 OANEX
Advisor 413838665 OAYEX
Investor 413838509 OAKEX
Service 413838855 OAREX
How will Oakmark communicate with me?

As a shareholder, you will receive a confirmation statement reflecting newly initiated purchases and redemption of shares in the Funds and changes in account services as well as periodic statements detailing distributions made by the Funds. Shares purchased by reinvestment of dividends and systematic transactions will be confirmed to you quarterly. You will receive periodic shareholder reports and an annual summary prospectus.

Subscribe to Oakmark email updates by providing us with your email address. You’ll be among the first to receive quarterly portfolio manager commentary along with important Fund updates and recent news articles.

We set high standards for the information we send and do not give anyone else access to your email address. You will never be asked for any personal information via email. If you receive an email that appears to be from Oakmark that requests personal information, do not respond. Please contact an Investor Services Representative at your earliest convenience.

There are instances where we may attempt to contact you via telephone. For instance, you may receive a phone call from us regarding a recent transaction or service request we received from you. We will attempt to call you if we can accept instructions or resolve an issue over the phone. At first, you will hear an automated message that will say the call is on behalf of the Oakmark Funds and ask you to press 1 to speak with an Investor Services Representative. Once you press 1, you will be connected to a live Investor Services Representative.

How does Oakmark protect the security of my accounts?

Customer verification
When you contact us by phone, we always verify your identity before granting access to your accounts.

When you log into your account at oakmark.com, we require two-factor authentication. This feature provides an extra layer of protection with a one-time security code to verify your identity when accessing your accounts from an unrecognized computer or device.

Additional verification for adding bank information
We require all Oakmark account owners to obtain a Medallion Signature Guarantee to add bank information to an existing account by mail.

When adding bank information online, we perform real-time validation of account owner and bank account status with your bank.

Fraud detection
We monitor transactions for suspicious and unusual behavior to ensure that they are authentic and legitimate. If we detect abnormal activity in one of your accounts, we will notify you immediately.

Confirmation of account activity
We produce confirmation statements to confirm maintenance and financial transactions to you. For certain activity, confirmation statements are always mailed to the address of record in addition to email, if you’ve enrolled in e-delivery.

What can I do to protect the security of my accounts?

Establish a user name and password 
We strongly encourage all Oakmark shareholders to establish login credentials through oakmark.com to protect your accounts with two-factor authentication.

Enroll in e-delivery
By electing e-delivery, we will inform you when a confirmation statement, quarterly statement or tax form is available online. You won’t need to worry that the mailed document could be lost or misdirected.

Review your accounts regularly
Review your activity on a regular basis and open all communication you receive from Oakmark. Immediately notify us of any address changes.

Don’t share your personal information
Take special care when responding to emails that request you provide your personal information or ask you to visit a website to confirm your identity since they may not be from legitimate sources. The Oakmark Funds will never ask you for your login, payment or personal information via email.

Manage your passwords
Change passwords regularly for sites that have personal information and financial details, use strong passwords that are long and employ a mix of numbers, upper and lower case letters, and special characters, and create different passwords for separate accounts in case one account is compromised.

What can I do if I believe I am a victim of identity theft or financial fraud?

Please call us immediately at 1-800-OAKMARK (625-6275). We are able to implement security measures on our end to help protect your accounts. Change your login credentials for websites and contact the local police right away.

For additional resources, please refer to the following FBI website that provides assistance for victims of financial crimes: https://www.fbi.gov/file-repository/financial_crime.pdf/view

What is your business continuity plan?

Harris Associates Securities L.P., the distributor of the Oakmark Funds, maintains a business continuity plan designed to respond reasonably and effectively to events of varying scope. Plans define critical functions, staff assignments, alternate work locations, resource requirements and vital records necessary for restoring business operations with minimal impact. Plans are continually reviewed and amended as necessary to ensure that documented procedures are current and recovery strategies support our operations.

What is my liability for internet and phone transactions?

You may perform many transactions—including exchanges, purchases and redemptions—by telephone and over the internet. To prevent unauthorized transactions in your account, the Funds will take precautions designed to confirm that instructions communicated through the telephone or internet are genuine. For example, the Funds or their agents may record a telephone call, request a PIN or password, request more information and send written confirmations of telephone and internet transactions. The Funds request that shareholders review these written confirmations and notify the Funds immediately if there is a problem. A Fund will not be responsible for any loss, liability, cost or expense resulting from an unauthorized transaction initiated by telephone or the internet if it or its transfer agent follows reasonable procedures designed to verify the identity of the caller or internet user.

Whenever we receive a telephone order, we take steps to make sure it is in good order. These may include asking for identifying information and recording the call. As long as a Fund and its representatives take reasonable measures to verify the authenticity of calls, investors may be responsible for any losses caused by unauthorized telephone orders.

Escheatment

What is escheatment?

Financial institutions, including the Oakmark Funds, are required to transfer your financial assets to the state of your account registration if they are unclaimed or deemed abandoned under the state’s property laws. This process is referred to as escheatment.

What is abandoned property?

State unclaimed and abandoned property laws generally apply to both unclaimed shares and uncashed dividends or other distributions.

The rules for determining when a security or security distribution is required to be escheated to the state vary considerably by state and may depend on the type of account.

  • Some states require escheatment if you have not initiated contact or activity with the Funds within a specified time period (generally three or five years).
  • Other states require escheatment only if mailings sent to you are returned as undeliverable by the United States Postal Service.
How long does my account(s) have to be considered abandoned property before escheatment?

Generally, account(s) have to be considered abandoned for three or five years before escheatment.

Will you notify me if I’m at risk for escheatment?

Oakmark makes every effort to mail a notice to you if you are at risk of escheatment due to inactivity. Please open all correspondence from Oakmark and respond promptly, if requested.

Do I need to initiate contact or activity on all my Oakmark accounts?

Contact is recorded for every account under a Social Security Number (SSN) or Tax Identification Number (TIN). If you have accounts under different SSNs or TINs, please initiate contact or activity for each SSN or TIN.

How do I keep my Oakmark account(s) active?

To prevent your assets from being deemed abandoned and escheated, it is recommended that you maintain direct contact with the Funds. Initiate contact with the Funds at least annually by:

  • Accessing your account through Oakmark’s secure website at Oakmark.com,
  • Sending correspondence to Oakmark at P.O. Box 219558, Kansas City, MO 64121-9558, or
  • Calling 1-800-OAKMARK (625-6275) to speak with an Investor Service Representative; Monday through Friday, from 8:00 a.m. to 6:00 p.m. Eastern Time.

In addition, please promptly notify us of any name and address changes and cash dividend and redemption checks from your account(s).

I receive my quarterly statements. Isn’t that sufficient?

In many states, receipt of shareholder statements is not sufficient as there is a requirement to have shareholder-initiated contact.

Are automatic investment or redemption plans considered contact?

Automatic transactions (including dividend reinvestments) are not considered shareholder-initiated contact.

What happens if my Oakmark account is escheated?

Please visit your state treasurer’s website for information on recovering escheated assets.

How can I find out more about my state’s unclaimed property laws?

Please visit your state treasurer’s website for information on unclaimed property laws.

Online Account Access

How do I register for online account access?

Visit our Account Access page and select Set Up Access to register your account for online access. You will need to provide your Social Security Number/Tax Identification Number and Oakmark account number.

How do I change my user name and/or password for online account access?

Sign in to your account via our Account Access page. On the Account Profile page, select User Name or Password under Security Profile.

How can I retrieve my user name?

Visit our Account Access page and select Forgot User Name? You will need to provide your Social Security Number/Tax Identification Number, Oakmark account number and pass security to obtain.

How do I reset my password?

Visit our Account Access page and select Forgot Password? You will need to provide your Social Security Number/Tax Identification Number, Oakmark account number and pass security to obtain.

What happens if I get locked out of my account?

Contact an Investor Service Representative at 1-800-OAKMARK (625-6275) to have your login information reset. Please have your account information available for identification purposes as you will need to pass additional security questions.

What can I do via online account access?

Through online account access, you can:

  • Purchase, redeem or exchange
  • View and download quarterly statements and confirmation statements
  • View and download tax forms
  • Enroll in e-delivery
  • Add bank information
  • Change your address
  • Change your user name, password and update your security profile
  • Change your dividends and capital gains election
  • Establish an automatic purchase, redemption or exchange plan
  • View your cost basis information and change your cost basis method
  • View your transaction history
Will joint tenant accounts be available online under both Social Security Numbers?

At this time, joint tenant accounts are available only under the Social Security Number of the primary joint tenant. Generally, this is the individual listed first in the account registration or the Social Security Number, which is used for tax reporting purposes.

Taxes and Distributions

Taxes

Why did I receive Form 1099-DIV?

The Oakmark Fund in which you invest paid a distribution (dividends and/or capital gains) greater than $10. Whether you take distributions in cash or reinvest them, they are still subject to tax in the year they occur.

Why didn't I receive Form 1099-DIV?

You may not have received Form 1099-DIV because:

  • Oakmark is not required to report dividends and capital gains distributions that are less than $10 for a Fund account. However, you are responsible for including this amount on your income tax return. Your year-end statement will show the amount of dividends and capital gains that were paid to you.
  • The Fund you invested in did not pay a distribution during the calendar year. Please visit our Distributions page to determine if your Fund paid a distribution.
  • The tax status on your account may be listed as “exempt.” Certain account types, including corporations, charitable organizations, IRAs and pension/profit-sharing plans, may be exempt from reporting.
How do I read my Form 1099-B?

Form 1099-B provides your cost basis for redemptions of Oakmark shares purchased on or after January 1, 2012.

Why didn't I receive Form 1099-B?

Form 1099-B may not have been produced because:

  • You did not make a redemption or exchange during the calendar year.
  • Redemptions and exchanges from the Oakmark Units Financial Square Treasury Solutions Fund (money market fund) are not reported.
  • The tax status on your account may be listed as “exempt.” Certain account types, including corporations, charitable organizations, IRAs and pension/profit-sharing plans, may be exempt from reporting.

Please check for your tax forms online or call 1-800-OAKMARK (625-6275) if you have any questions.

Why didn't I receive Form 1099-R?

You may not have received Form 1099-R because:

  • You did not redeem from your IRA during the prior tax year.
  • You may have made a non-reportable direct transfer of assets between two IRA custodians/trustees.
  • Oakmark is not required to report distributions that are under $10.00 with no federal tax withheld.

Please check for your tax forms online or call 1-800-OAKMARK (625-6275) if you have any questions.

Why didn't I receive Form 5498 or 5498-ESA?

You made no contributions to your IRA or Coverdell Education Savings Account (ESA) for the prior tax year.

Please check for your tax forms online or call 1-800-OAKMARK (625-6275) if you have any questions.

Why did I receive a Form 1099-R when I rolled my distribution to an IRA within the 60-day limit?

Although a direct rollover within the 60-day limit does not generally trigger a taxable event, Oakmark is required to report it to the IRS. However, direct transfers between custodians involving the same type of IRA are generally not reportable on Form 1099-R.

Please call 1-800-OAKMARK (625-6275) if you have any questions.

What is cost basis?

Cost basis is generally the original price that you paid for your shares, including reinvested dividends and capital gains, and is used to determine gains and losses on any shares you redeem or exchange in a taxable (non-retirement) account. Mutual funds are required to report cost basis for taxable (non-retirement) accounts and accounts owned by S corporations to the IRS and taxpayers via Form 1099-B.

What are covered shares? What are non-covered shares?

Covered shares are the mutual fund shares you purchase on or after January 1, 2012. Non-covered shares are the mutual fund shares you purchased prior to January 1, 2012. The rule does not require mutual funds to report cost basis information to the IRS for non-covered shares.

Am I able to change my election?

You may always change your cost basis election for covered shares from the date of acquisition going forward. If you have elected or defaulted to Average Cost and there have not been any redemptions or exchanges of covered shares from your account, you may revoke your prior election and retroactively elect a different cost basis method for your covered shares. However, once you sell covered shares using the Average Cost method, you may not change your cost basis method on existing covered shares in your account. For all other cost basis methods, you may change your cost basis method on existing covered shares at any time.

How can I view or change the cost basis method for covered shares in my account?

You may view or change your cost basis method online by selecting Update Cost Basis Method from the Cost Basis tab or by calling an Investor Service Representative at 1-800-OAKMARK (625-6275). Requests to change your cost basis method to or from average cost must be made online or by sending us the Shareholder Services Form.

What cost basis methods are available?

Cost basis methods recognized by the IRS include Average Cost (ACST); First-In, First-Out (FIFO); and Specific Lot Identification (SLID). The Oakmark Funds can automate several tax conventions, which are essentially forms of SLID, to achieve certain taxable outcomes, and these are described below. You should consult your tax advisor for questions regarding which method is appropriate for you.

Average Cost (ACST) – A standing order to sell the oldest shares in the account first and report their Average Cost. Average Cost is calculated by adding up the cost of all shares in the account and dividing by the total number of shares in the account. The average cost per share is applied to the total number of shares sold to determine the cost basis of those shares being sold. The Average Cost of covered shares is calculated separately from non-covered shares as if they were in two separate accounts.

First-In, First-Out (FIFO) – A standing order to sell the oldest shares in the account first. The actual cost and dates of purchase for those shares are reported.

Last-In, First-Out (LIFO) – A standing order to sell the newest shares in an account first. The actual cost and dates of purchase for those shares are reported.

High-Cost, First-Out (HIFO) – A standing order to sell shares purchased at the highest cost first. The actual cost and dates of purchase for those shares are reported.

Low-Cost, First-Out (LOFO) – A standing order to sell shares purchased at the lowest cost first. The actual cost and dates of purchase for those shares are reported.

Loss/Gain Utilization (LGUT) – The Loss/Gain Utilization method is used to deplete the shares with the largest losses first and the shares with the largest gains last. The actual costs and dates of the purchases for those shares are reported. Please see additional information below for a more detailed explanation of LGUT.

Specific Lot Identification (SLID) – The shareholder will be required to designate the specific shares to redeem when placing their redemption request. A secondary accounting method is required for use if specific lots are not identified in the redemption request or the lots chosen are no longer available. Please note that Average Cost cannot be used as a secondary accounting method.

Can you explain in more detail the Loss/Gain Utilization method?

The Loss/Gain Utilization method is used to deplete the shares with the largest losses first and the shares with the largest gains last. This will be done on a per share basis in each tax lot. The following is the order in which the tax lots will be depleted:

•  Short-term losses (in descending order, greatest loss per share to least loss per share)
•  Long-term losses (in descending order, greatest to least)
•  Short-term no gain or loss
•  Long-term no gain or loss
•  Long-term gains (in ascending order, least gain per share to most gain per share)
•  Short-term gains (in ascending order, least to most)
•  Lots with unknown cost in FIFO order (by acquisition date) and then least share count order

What cost basis method is best for me? How can I decide?

It depends on your personal tax situation. You should consult with a tax advisor to decide which option is best for you.

What is the purpose of the cost basis method I choose?

Your cost basis election impacts the taxable gains or losses that will be reported by Oakmark to the IRS and reported by you on your income tax return. Your election also affect the order in which covered shares are depleted from your account. As a general rule, unless you select SLID as your cost basis method, non-covered shares will be redeemed prior to your covered shares.

If my account contains both covered and non-covered shares, which shares will be depleted first?

When you sell shares in your taxable Oakmark account, we will automatically deplete any non-covered shares first, unless you specifically identify share lots you wish to sell using the SLID method. In addition, if both covered and non-covered shares are redeemed, two different cost basis calculations for the same redemption may appear on Form 1099-B.

Am I able to change the cost basis method used for a sale of shares after it has occurred?

Under current IRS regulations, you are not allowed to change the cost basis used for a sale after it has occurred.

What is my cost basis for an investment I received as a gift?

Generally, you must use the donor’s basis. The basis for loss is either the donor’s basis or the fair market value of the shares at the time of the gift, whichever is lower. In some cases, there is neither a gain nor a loss if the sales proceeds are greater than the fair market value on the date of the gift and less than the donor’s basis. Please complete the Change of Registration Form to process a gift of shares.

How is cost basis information reported to the IRS?

Form 1099-B indicates if the gain or loss from an exchange or redemption is short term or long term and the amount of any loss disallowed under IRS wash sale rules. The form includes cost basis information for sales of covered shares.

If share cost information is available, the form may also include cost basis information for sales of non-covered shares. The cost basis for non-covered share redemptions will be reported to you and not to the IRS using the “average cost” method. It will continue to be your responsibility to calculate and report to the IRS any gains or losses on such shares sold using average cost or any other cost basis method you may choose.

Distribution

Where can I find current and historical distribution information?

To find out what distributions have been declared this year and view prior year distributions, visit our Distributions page.

How frequently are distributions paid?

Generally, Oakmark declares distributions annually and they are paid mid-December.

When are distribution estimates made available?

Typically, distribution estimates are posted in November.

How are distributions paid?

Unless you request payment via check, all dividends and capital gains will be reinvested in additional Fund shares. Outstanding checks greater than six months or checks returned as undeliverable will be reinvested in additional Fund shares.

You may change your distribution option online by selecting Dividends & Capital Gains Election under the Account Profile tab. You may also complete and mail the Shareholder Services Form.

What are the different types of distributions?

Distributions include income and/or capital gains (short and/or long term):

Income Distributions

Mutual funds earn dividends, interest and other investment income on the securities in which they invest. A fund subtracts its expenses from this investment income and distributes the remainder to its shareholders as ordinary income.

Qualified Dividend Income

When a mutual fund receives a dividend from a security that it held for more than 60 days, that dividend is generally classified as qualified dividend income. The portion of the income distribution that is attributable to qualified dividend income can be classified as such and has favorable tax rates compared to regular income distributions.

Capital Gains

When a fund makes a profit from selling securities, it passes that profit on to shareholders as capital gains. Capital gains can be classified as short term or long term.

  • Short-term capital gains occur from selling shares that have been held by a fund for one year or less.
  • Long-term capital gains occur from selling shares that have been held by a fund for more than a year.

Foreign Tax Credit

For funds that invest in foreign securities, there may also be an amount for foreign tax credit. Mutual funds are allowed to pass taxes paid to foreign governments through to their shareholders.

What is the record date?

If you own shares of a fund by the close of business on this day, you will receive the distribution. The total distribution is determined by the number of shares held on the record date multiplied by the distribution dollar amount per share.

What is the ex-dividend date?

Distributions are made from a fund on this day. In turn, a fund’s share price drops by the amount of the distribution (plus or minus daily market activity).

When will I see the distribution activity on my account?

Actual distributions are posted to your direct account on the next business day the Funds are open after the ex-dividend date; however, the activity will be reflected as of the ex-dividend date.

For direct shareholders who elect to reinvest distributions, additional shares are purchased. For those who choose not to reinvest distributions, a cash distribution will be made.

SECURE Act and CARES Act

What is the SECURE Act and how does it impact me?

In December of 2019, the Setting Every Community Up for Retirement Enhancement Act (SECURE Act) was signed into law and provides several changes to the treatment of retirement plans and IRAs that are effective January 1, 2020.

Please note that the Oakmark IRA Disclosure Statement and Custodial Agreement (Oakmark IRA Booklet) has been updated to reflect the following changes relating to IRAs that are summarized below:

Increase in age for Required Minimum Distributions (RMDs) for certain individuals
The Required Beginning Date for RMDs has increased from age 70 ½ to the age of 72. This is effective for anyone who turns 70 ½ on or after January 1, 2020, i.e., birthdays after June 30, 1949. Shareholders who turned 70 ½ in 2019 or before are not impacted by the change to the RMD age and must continue to take their RMD.

No age limit for traditional IRA contributions
For taxable years 2020 and later, traditional IRA shareholders of any age are eligible to contribute to their IRA if they have earned income. People whose spouses have earned income also can take advantage of spousal IRA contributions. Prior to the SECURE Act, individuals over age 70 ½ could not contribute to traditional IRAs. For 2020, the maximum contribution is $7,000 for individuals age 50 and older.

Elimination of “stretch IRA” option
For inherited IRAs (including Roth IRAs), all assets must be redeemed no later than the end of the 10th year following the year the IRA owner died. This is effective with respect to shareholders who die after December 31, 2019. Designated beneficiaries who are exempt from the 10-year rule and may take life expectancy distributions include surviving spouses, minor children, disabled individuals, the chronically ill, and beneficiaries not more than 10 years younger than the IRA owner.

New IRA withdrawal option for a birth or adoption
“Qualified birth or adoption distributions” are permitted from IRAs for distributions made after December 31, 2019. Such distributions are exempt from the 10% early distribution penalty, but they must be taken within one year of birth or adoption and are limited to $5,000 per birth or adoption (per spouse). The adoption of anyone over 18 (other than an individual physically or mentally incapable of self-support) or the adoption of a spouse’s child does not qualify. Distributions can later be rolled back into an IRA and will be treated as a direct trustee-to-trustee transfer. It will be up to the IRA owner to substantiate to the tax authorities that the distributions are a qualified birth or adoption distribution.

Due to the complexity of these new rules, we encourage you to refer to the Oakmark IRA Booklet to learn more and speak with a tax and/or legal professional regarding questions you have regarding your unique situation.

What is the CARES Act and how does it impact me?

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted and includes the following provisions:

Waiver of Required Minimum Distributions (RMD) in 2020
The waiver applies to all 2020 RMDs. For shareholders who attained age 70 ½ in 2019 and did not take their first RMD by December 31, 2019, the waiver applies to the 2019 RMD that would normally have been due by April 1, 2020. The waiver also applies to RMDs required by beneficiaries of inherited IRAs (including Roth IRAs).

For beneficiaries who inherited an IRA that is subject to the five-year distribution rule, the year 2020 is disregarded and beneficiaries will now have a total of six years to complete their distributions.

The Oakmark Funds will not automatically suspend 2020 systematic RMD payments. If you would like to defer systematic RMD payments for 2020, please contact us in writing or by phone at 1-800-OAKMARK (625-6275).

If you have already taken an RMD in 2020, you may have the opportunity to roll over that distribution within 60 days. Please note, individuals may make only one 60-day rollover from one IRA to another IRA in any 12-month period (measured from the date you receive the distribution from the first IRA). This one-rollover-per-year limit is applied by aggregating all of your IRAs. Please contact a tax professional for questions regarding rollovers.

Relief for certain IRA withdrawals in 2020
IRA shareholders impacted by the coronavirus are entitled to withdrawals from IRAs up to a maximum of $100,000 that are exempt from the 10% early withdrawal penalty. Impacted individuals include those diagnosed with SARS-CoV-2 or COVID-19 and their spouses or dependents and those who have experienced “adverse financial consequences” from quarantine, furlough, layoffs, reduced work hours, inability to work due to lack of childcare, or closing of or reduced hours of a business owned or operated by the individual on account of the coronavirus. The income tax treatment of the withdrawal does not change, but that income can be spread ratably over three tax years. In addition, you have the option to repay the distribution within three years and be eligible to receive a refund on some or all of the taxes previously paid.

Extension of 2019 federal tax filing and IRA contribution deadline
The deadline for filing and paying 2019 federal income taxes (without interest or penalties) and making a 2019 IRA contribution has been extended to July 15, 2020. Each state establishes its own deadline for paying and filing state income taxes, so please refer to a tax or legal professional with any questions regarding your state’s filing requirements.

This is for informational purposes only and is not intended as a recommendation, investment or tax advice. Please consider consulting a legal, financial or tax professional.

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