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VUSXX (Vanguard Treasury Money Market Fund) Portfolio Composition During 2024

RichardW
  |     |   821 posts since 2019

During 2023, VUSXX (Vanguard Treasury Money Market Fund) held a substantial amount of repurchase agreements within its portfolio and consequently reported only 80.06% of its ordinary dividends were generally exempt from state and local taxes in tax year 2023. Repurchase agreements (including those that involve Treasuries) are generally subject to state and local taxes.

I have been monitoring the portfolio composition of VUSXX each month since January 2024. So far in 2024, I have not noticed any repurchase agreements held in VUSXX’s portfolio. If this trend continues, it appears likely that VUSXX is on track to have nearly 100% of its ordinary dividends to be generally exempt from state and local taxes in tax year 2024, just like it did in tax year 2022.

In tax year 2024, this potential scenario is encouraging news for individuals who have VUSXX and reside in states with high state income tax.

Here are links to the associated Vanguard tax information documents from tax year 2022, and tax year 2023:

https://personal1.vanguard.com/pdf/USGOIN_2023.pdf

https://investor.vanguard.com/content/dam/retail/publicsite/en/documents/taxes/usgoin-2024.pdf

A similar Vanguard tax information document for tax year 2024 will most likely be released in February 2025

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11


RichardW
  |     |   821 posts since 2019
The title given to a particular money market fund can be very misleading. For example, the “Fidelity Treasury Money Market Fund” (FZFXX) was composed of about 42.36% repurchase agreements as of 11/30/2024. Before you purchase a money market fund, examine the composition of the fund’s portfolio, and read the risk profile listed in the fund’s prospectus to determine if it satisfies your investment objectives. Buyer Beware.

https://fundresearch.fidelity.com/mutual-funds/composition/316341304
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4
txFish1
  |     |   479 posts since 2023
RichardW, that is a great example about the Fidelity MM FZFXX. I almost purchased this fund without realizing it had such a large percent of repurchase agreements . I meant to buy FDLXX (which I ultimately did) which is 99% T-bills. Even though I am in Texas which does not have a state tax I still prefer to buy a Treasury only MM and the difference in yield is only 2 basis points currently.
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