Fortunately, no. The amount of the benefits includible in gross income may be zero, somewhere between zero and 50%, or somewhere between 50% and 85%; 85% is the maximum taxable percentage. The exact amount depends on the amount of your net benefits, your tax-free interest from municipal bonds, and your overall income.
A mutual-fund distribution allocated to gains realized on the sale of fund portfolio assets. You report the distribution as long-term capital gain even if you held the fund shares short term.