With a Mutual Fund, thats total capital gain was$950. for the year, and u have no other income does it pay tax

Answer 1

If you're saying that you had a mutual fund that paid $950 for the year as a capital gains distribution but you had no other income, then no, you're below the level where you'd have to pay income tax for federal. Depending on your state, you might owe state income tax.

Answer 2

If you cashed it in, yes there is tax to pay. If you have more than $850 in unearned income you must file and may have taxes to pay.

If you have not cased in any of the fund, the gain on paper is not taxable until you actually sell off shares.