Thornburg California Limited Term Municipal Fund
All income earned by Thornburg California Limited Term Municipal Fund (the “Fund”) during 2007 was based on investments in municipal obligations of political subdivisions located in the state of California, or on investments in obligations of U.S. territories and possessions which bear interest exempt from taxation by the state of California. Generally speaking, distributions made by the Fund to individuals are not subject to federal income taxes, but they must be reported on your 2007 federal income tax return. However, a small portion of this income, as shown below, may be treated as a preference item for the purposes of the alternative minimum tax on certain individuals and on corporations. Shareholders are advised to consult their own tax advisors as to the extent and effect of such treatment.
The Fund did not declare capital gains distributions in 2007.
| Jan | Feb | Mar | Apr | May | June | July | Aug | Sep | Oct | Nov | Dec | Avg 07 | |
| Municipal Income | 88.86% | 88.93% | 89.69% | 91.05% | 91.41% | 91.38% | 92.36% | 91.84% | 90.94% | 90.82% | 91.25% | 91.20% | 90.80% |
| Municipal Preference Income | 11.14% | 11.07% | 10.31% | 8.95% | 8.59% | 8.62% | 7.64% | 8.16% | 9.06% | 9.18% | 8.75% | 8.80% | 9.20% |
| Total Municipal Income | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
Special Requirements for Corporations
Interest on all tax-exempt investments owned by a corporation, including income dividends on shares of the Fund, will be included in such corporation’s adjusted net book income for purposes of calculating the alternative minimum taxable income of such corporations.
Investments in the Fund carry risks including possible loss of principal. As with direct bond ownership, funds that invest in bonds are subject to certain risks including interest-rate risk, credit risk, and inflation risk. The principal value of bond funds will fluctuate relative to changes in interest rates; decreasing when interest rates rise. Unlike bonds, bond funds have ongoing fees and expenses. Investments in the Fund are not FDIC insured, nor are they deposits of or guaranteed by a bank or any other entity.
Carefully consider the Fund’s investment objectives, risks, sales charges, and expenses; these are found in the prospectus, which is available from your financial advisor or from our download library. Read it carefully before you invest or send money.
