A Closer Look at Your Tax Information

Form 1099-DIV—Dividends and Distributions

This form shows how much you received from your fund(s) in 2007 from dividends, capital gain dividends and nondividend distributions. You will receive Form 1099-DIV even if you reinvested your distributions in additional fund shares instead of receiving them in cash.

1. Recipient's Identification Number: Make sure your correct and certified Social Security or Taxpayer Identification number appears in this box. If the number is missing or incorrect, you could be subject to backup withholding under IRS rules.
2. Ordinary Dividends: Column 1a shows ordinary dividends, which include any taxable dividends on tax exempt funds and any 2007 net short-term capital gain dividends from your fund. This amount excludes any long-term capital gain dividends or nondividend distributions paid by your fund.
3. Qualified Dividends: Column 1b shows the amount of ordinary dividends in column 1a that are attributable to qualified dividend income. The amounts shown may be taxed at 15 percent.
4. Total Capital Gain Distribution: Column 2a shows your total long-term capital gain distributions.
5. Unrecaptured Section 1250 Gain: Column 2b shows your gain from certain depreciable real property.
6. 28% Rate Gain: Shown in Column 2d. Mutual fund investors typically do not have any capital gains on securities taxable at the 28% rate.
7. Nondividend Distributions: Column 3 shows the part of the distribution that is nontaxable because it is a return of your cost (or other basis). You may not be taxed on these distributions, but you should reduce your cost (or other basis) by this amount. If you reduce your basis to zero, then these nondividend distributions would result in capital gain.
8. Federal Income Tax Withheld: Column 4 shows any federal income tax withheld from your distributions. Withholdings usually occur because of an incorrect or missing Social Security or Taxpayer Identification number, or at the request of the IRS. The amount in Column 4 should be reported as “federal income tax withheld” on your 2007 federal income tax return.
9. Foreign Tax Paid: Column 6 shows any foreign taxes paid by your fund. You can claim this amount as an itemized deduction, or you may be able to obtain a foreign tax credit. See page 7 for additional information regarding foreign tax credits.

Form 1099-B—Proceeds From Broker and Barter Exchange Transactions

This form reports the gross proceeds from any redemptions or exchanges in 2007. It also reports average cost basis and gain or loss information (if known).

1. Date of Sale or Exchange: Column 1a shows the trade date of each redemption or exchange.
2. Gross Proceeds From Stocks, Bonds, Etc.: Column 2 reports the gross amount of your redemptions or exchanges. The amount is reported whether you received the proceeds in cash or exchanged them for shares of another fund.
3. Federal Income Tax Withheld: Column 4 shows any federal income tax withheld from your distributions. Withholdings usually occur because of an incorrect or missing Social Security or Taxpayer Identification number, or at the request of the IRS. The amount in Column 4 should be reported as “federal income tax withheld” on your 2007 federal income tax return.
4. Description of Transaction: Column 7 shows your account activity.
5. Cost Basis and Gain (Loss) Information: This section shows the average cost basis of your shares, which is then used to determine any capital gain or loss to your account. This information is shown only if it is available. Cost basis information is not available for all accounts, including accounts established before 1984 and accounts for which ownership has been transferred. To determine your cost basis, you will need your transaction information. Please see your account statements and consult your tax advisor.
   
   (#) Wash Sale
   Any loss that is noted with a pound symbol (“#”) on Form 1099-DIV and Form 1099-B has been adjusted because of a wash sale transaction. A wash sale occurs when a) you redeem shares at a loss and repurchase them within 30 days after the sale, or b) you purchase additional shares of a fund you already own and then sell your current holdings for a loss within 30 days. Losses resulting from a wash sale are not allowed as a deduction by the IRS and must be added into the average cost basis of the repurchased shares.

* Your Form 1099-B form will look like Version 1 if your account has average cost information, or Version 2 if your account does not have average cost information. You’ll see only the version that applies to you.

A Word About Average Cost Basis
Average cost basis is the amount you’ve contributed toward the purchase of mutual fund shares—in other words, the price of your original purchase and all subsequent purchases of mutual fund shares. For tax purposes, cost basis is used to determine capital gains or capital losses on your redemptions and exchanges. More information about average cost basis appears on the back of Form 1099-DIV and Form 1099-B.

Van Kampen calculates cost basis using the Single Category Average Cost method. To calculate your cost basis with this method, we take the total cost of all of your shares, including your original purchase, subsequent purchases, and any purchases through reinvestment of dividends, capital gains or return of capital distributions. Then we divide this number by your total number of shares.

The IRS allows you to select from four methods for calculating your cost basis. We suggest you talk to your tax advisor to determine which method is most appropriate for you.

Form 1099-INT

The Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA) eliminated the exception from Form 1099 tax reporting for tax-exempt interest, including exempt interest dividends from mutual funds. Now, tax-exempt interest earned after December 31, 2005, is reportable in the same manner as taxable interest.

This Form is included with your 1099 forms if you received tax-exempt income in 2007. Shareholders of state-specific tax-exempt funds will also find the percentage of their tax-exempt income that is subject to the federal Alternative Minimum Tax (AMT) on this Form. For specific information regarding the federal AMT and its impact on your tax situation, please consult your tax advisor.

Residents of California, Connecticut and New York, please note: Information regarding exempt-interest dividends paid by your Van Kampen fund is being reported to your tax authority.

1. Recipients Identification Number: Make sure your correct and certified Social Security or Taxpayer Identification number appears in this box. If the number is missing or incorrect, you could be subject to backup withholding under IRS rules.
2. Account Number: This column may show your Van Kampen account number.
3. Interest Income: This column is not applicable to mutual fund investors.
4. Interest on U.S. Savings Bonds, etc.: This column is not applicable to mutual fund investors.
5. Federal Income Tax Withheld: Column 4 shows any federal income tax withheld from your distributions. Withholdings usually occur because of an incorrect or missing Social Security or Taxpayer Identification number, or at the request of the IRS. The amount in Column 4 should be reported as “federal income tax withheld” on your 2007 federal income tax return.
6. Foreign Tax Paid: Column 6 shows any foreign taxes paid by your fund. You can claim this amount as an itemized deduction, or you may be able to obtain a foreign tax credit. See page 7 for additional information regarding foreign tax credits.
7. Tax-Exempt Interest: Column 8 shows the amount of tax-exempt dividends from your mutual fund.
8. Specified Private Activity Bond Interest: Column 9 shows the amount of income from the fund’s investment in specified private activity bonds which may be subject to the federal AMT.

Income Breakdown

This insert is included in your tax packet if you owned a tax-exempt fund that is not state-specific.

1. Source of Tax-Free Income by State: This information will help you determine if some of the tax-free income you earned in 2007 is also exempt from your state taxes. Here, you’ll find the sources of your fund’s earnings and the percentage of total earnings they represent. Consult your tax advisor for specific information regarding the taxability in your state.
2. Federal Alternative Minimum Tax (AMT): If your fund invests in specified private activity bonds, you may be subject to the federal AMT. The percentage of your income from specified private activity bonds, which is an AMT preference item, is located here. For specific information regarding the federal AMT and its impact on your tax situation, please consult your tax advisor.

Government Obligations

This insert is included in your tax packet if you own a fund which earned income from U.S. government obligations.

1. Primary Obligations: This column shows the percentage of your income from primary obligations of the U.S. Government. Primary obligations represent direct treasury securities.
2.  Primary Obligations: This column shows the percentage of your income from secondary obligations of the U.S. Government. Secondary obligations generally represent U.S. agency obligations.
3. Percentage Greater than 50% at Each Quarter-End: If the percentage of your fund’s assets invested in government obligations exceeded 50 percent for each quarter, then “YES” is shown here. Your state may allow you to exclude the value of your investment in U.S. government obligations. We recommend that you consult your tax advisor for details.

Foreign Tax Credit

For 2007, certain funds have elected to pass through to their shareholders the opportunity to claim foreign taxes paid by the funds as either a credit or a deduction. As a result of this election, your share of foreign taxes paid has been reported in Column 6 on your Form 1099-DIV (“Foreign tax paid”) as well as included in your gross income in Columns 1a and 1b on your Form 1099-DIV. For informational purposes, the foreign sourced income relating to these foreign taxes is reflected below:

Fund	Percent of Column 1a that is Foreign Sourced Income	Percent of Column 1b that is Foreign Sourced Income
Emerging Markets Fund	49.99%	49.99%
Global Equity Allocation Fund	71.20%	71.20%
Global Franchise Fund	50.10%	50.10%
Global Value Equity Fund	45.99%	45.99%
International Advantage Fund	86.53%	86.53%
International Growth Fund	100.00%	100.00%

Although country-by-country information on the above amounts of foreign taxes and foreign source income has been provided in the past, shareholders generally no longer need this country-by-country information due to changes in the foreign tax credit provisions of the Tax Law.

Van Kampen does not offer tax advice. Please consult your tax advisor for more information about your individual situation.

 Tax Guide

Form 1099-DIV

Form 1099-B

Form 1099-INT

Income Breakdown

Government Obligations

Foreign Tax Credit

Complete Tax Guide