Form 1099-DIV: Dividends and Distributions Overview

Form 1099-DIV: Dividends and Distributions is an Internal Revenue Service (IRS) form sent to investors who receive distributions from any type of investment during a calendar year. Investors can receive multiple 1099-DIVs. Each Form 1099-DIV should be reported on an investor’s tax filing.

Certain types of investment accounts are exempt from issuing a Form 1099-DIV. Exempt accounts include individual retirement accounts (IRAs), money purchase pension plans, profit-sharing plans, and various retirement accounts. Investors typically will not receive a 1099-DIV if cumulative dividends are not greater than $10.

Investment companies are required to provide taxpayers with a 1099-DIV by January 31 each year. Companies provide a copy of the Form 1099-DIV to the investor and to the IRS.

Most investors who receive a Form 1099-DIV will have ordinary dividends, qualified dividends, or total capital gains. Other categories for investors include unrecaptured section 1250 gain, section 1202 gain, collectibles gain, non-dividend distributions, federal income tax withheld, investment expenses, foreign tax paid, foreign country or U.S. possession, cash liquidation distributions, noncash liquidation distributions, exempt-interest dividends, specified private activity bond interest dividends, and state tax withheld. Investors may also be subject to Foreign Account Tax Compliance Act (FATCA) filing requirements for foreign accounts. This is a law that requires U.S. citizens, both in the country and abroad, to file reports on foreign account holdings.

[Important: Foreign account holdings must be reported in U.S. dollars.]

Taxpayers are required to file each Form 1099-DIV: Dividends and Distributions they receive on their annual tax form. This can be done on a Schedule B form or directly on the Form 1040. Dividends are taxed at an investor’s income tax rate with a few exceptions. Qualified dividends are the primary exception. Qualified dividends have met certain criteria that allow them to be taxed at a lower tax rate.

The tax rate on capital gains may also vary from the ordinary income tax rate. Short-term capital gains are taxed at the ordinary income tax rate, but long-term capital gains will pay lower taxes.

The form, which can be downloaded on the IRS website, has three copies. Copy A, in red, is for informational purposes only and should not be printed. There are two parts of Copy B, which can be downloaded and printed. One is for the recipient, while the other is attached to the tax return for the state tax department. This section, which is in black, can be used to satisfy the requirements of the recipient.

The form includes the recipient's name, address, and Social Security number. It also has the payer's name, address, identification number, and plan number. The right side of the form outlines some of the important figures the recipient will need, including the total ordinary dividends, qualified dividends, and total capital gain distribution.

Click on this link to download a copy of Form 1099-DIV: Dividends and Distributions.

• Form 1099-DIV: Dividends and Distributions is sent to investors who receive distributions from any type of investment during a calendar year.
• Investment companies are required to provide taxpayers with a 1099-DIV by January 31 each year.
• Taxpayers file each Form 1099-DIV either on a Schedule B form or directly on Form 1040.