Because you are not at least 65 years old by the end of the year, you apply the 10% threshold to all of your itemized medical costs (which include costs related to your mother). If she claimed them on her own return, she could apply the 7.5% threshold.
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.