IRS 1099 Dividend PDF Template

[toc] Form 1099-DIV is a tax form that concerns your investments. People receive 1099-DIV forms when any of the stocks they own pay dividends over the year. A 1099-DIV is also issued when a person’s mutual fund investment gives them a capital gains distribution at some point during the year.

Unlike many other tax forms, the Form 1099-DIV won’t be filed with the IRS. However, you need to pay attention to the reported information when you put together your tax return. Most commonly, 1099-DIV forms are issued when a person’s stocks pay dividends, or their mutual fund investment makes a capital gains distribution to them.

The different boxes on the form will explain different aspects of your investment gains. Each box conveys a different piece of information. Though the calculations and implications for your taxes may seem complex, you can boil them down as long as you follow a few simple rules. You’ll need to use the form to understand which dividends translate to taxable income, and which gains are not subject to tax.

The IRS issues a Form 1099-DIV to anyone whose investments have earned them money over the past year. This includes gains made from stock dividends and mutual fund payments. If your investments have seen any gains over the past fiscal year, you can expect to receive a Form 1099-DIV in the mail. As mentioned, you won’t need to file it with your tax return. But you should keep it for your records, as the reported information is very important.

When you’re filing your taxes, you’ll need to use the Form 1099-DIV to determine whether any of your dividends are taxable income. These dividends must be reported with your income on your tax return. Depending on the information on the 1099-DIV, the amount of paperwork you file might also be affected.

The Form 1099-DIV is a receipt of your annual dividends. It’s possible that you will need to add a Schedule B attachment to your overall tax return. Even if no 1099-DIV is mailed to you, you’re still legally required to report any dividend income that’s taxable. Schedule B forms need to be used if your interest or dividends exceed $1,500.

Filing a Schedule B report won’t affect the total taxes you have to pay. The report is just a gathering of information about your interest and dividend income. You’ll need to separate each source and report them individually. If you’re confused by the questions asked, it helps to double check your math and work with an accountant.

The Form 1099-DIV is sent from the IRS to you, rather than the other way around. It’s not part of your official tax filing. As such, you won’t suffer any legal ramifications or tax penalties if you choose to discard it. However, discarding the form will make it very difficult to report your taxes accurately.

The Form 1099-DIV is an essential part of the tax calculation process. It summarizes a potentially huge chunk of your income. You need to check it to see whether your total earnings exceed $1,500, because when this is the case, your tax return must include a Schedule B form. You must also use the reported amounts to accurately report your income on your tax return.

If you fail to report your taxable income accurately, you could be subject to hefty fees. You’ll also have to pay the back taxes on that income. If you lack the means to pay, you’ll have to set up a payment plan with the IRS. These consequences can be easily avoided if you just treat the 1099-DIV like the important document it is.

You won’t be the one filling out the form, but this is how to read it:

In Box 1a, you’ll see the total amount from any ordinary dividends you’ve received. Box 1b reflects a portion of Box 1a, showing the dividends that are considered “qualified.” You’ll see mutual fund investment payments listed in Box 2a, while stock market gains will be found in Box 1a.

If your distributions have already had federal and state taxes withheld, the tax amounts will be recorded in boxes 4 and 14. Box 4 is your federal withholding total, while Box 14 is your state withholding total.

Subtract Box 1b from Box 1a to find your non-qualified ordinary dividends. On this amount, you’ll pay a normal tax rate.

Meanwhile, your qualified dividends are defined as a long-term capital gain. If you have a maximum tax bracket of less than 16 percent, these dividends are free of taxes. If you pay a tax rate higher than 15%, the qualified dividends tax rate will be 15% or 20%, depending on your total income.

Dividends are considered “qualified” when they’re paid by United States corporations, or by foreign corporations with a tax treaty with the United States. Stocks must have been traded with the United States stock market, and you must have owned the shares for at least 60 days.

Mutual funds gains, reported in Box 2a, are usually defined as long-term capital gains. This means that the same tax rules that apply to your dividends also apply to your mutual fund gains, no matter whether you’ve had the investment for a week or ten years.[pdf-embedder url=”https://cdn-prod-pdfsimpli-wpcontent.azureedge.net/pdfseoforms/pdf-20180219t134432z-001/pdf/irs-form-1099-dividend.pdf”]