1099 DIV

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1099 DIV

The tax statement used for reporting dividends paid to registered shareholders.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

1099 DIV

A form that every company is required to submit to all persons or companies earning taxable capital gains on the company. The form contains information on all dividends, interest, and other capital gains paid over the tax year. Publicly-traded companies, mutual funds, banks, and other companies paying dividends or interest must submit a 1099-DIV to each shareholder and bondholder, and report to the IRS how much it paid to each person or company.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
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Under these rules, for purposes of furnishing Forms 1099-DIV, Dividends and Distributions, to report the taxable (dividend) portion of the distribution, a corporation is required to treat the entire distribution as a taxable dividend unless it can establish the amount that is not a dividend.
If the S corporation distributes $35,000 or more to its shareholders, it will have paid out all of its accumulated E&P The $10,000 E&P is taxable as a dividend to shareholders, requiring the corporation to issue Forms 1099-DIV, Dividends and Distributions.
Consequently, large numbers of erroneous Forms 1099-DIV, used to report dividend income, were being mailed to taxpayers.
By contrast, the Form 1099-DIV, used to report corporate dividends, is much shorter and simpler, and multiple Forms 1099-DIV can be on the same page.
In addition to reaping income on deferred tax payments over the years, reporting and record keeping requirements are reduced, e.g., there will be no Forms 1099-DIV, Declaration of Estimated Tax may be reduced, etc.
(7) Hence, if a filer timely filed 100,000 of 100,000 Forms 1099-INT but only 1,990 of 2,001 Forms 1099-DIV, a penalty would be imposed even though -- in the aggregate -- the filer correctly filed 99.99 percent of required information returns.
The $10,000 E&P is taxable as a dividend to J's shareholders, requiring J to issue Forms 1099-DIV, Dividends and Distributions.
Each January, taxpayers owning mutual funds are inundated by annual reports and Forms 1099-DIV from their mutual fund companies.
Copies of Forms 1099-DIV, Dividends and Distributions, sent to the shareholders, should also be attached to the form if there are 12 or fewer shareholders.
The letter identified as most troublesome (1) compliance with Forms 1099-DIV, Dividends and Distributions; (2) fiscal-year flexibility for small businesses; and (3) the complexity in applying phaseout methods and definitions.
2003-28 to allow brokers to provide composite substitute payee statements for Forms 1099-DIV, Dividends and Distributions, and 1099-MISC, reporting payments in lieu of dividends.
The balance of the amounts reported as capital gain distributions on Forms 1099-DIV represents capital gains taxable at the 20% rate.