Dividends and Distributions
Form 1099-DIV is used for reporting dividends and other distributions. Form 1099-DIV is the same as any other information return. You can find the total income you earned from your distributions and the federal and state income tax withheld from this income.
Among all the Forms 1099, Dividends and Distributions is the most comprehensive one that provides the most information to taxpayers. On 2021 Form 1099-DIV, you will find:
- Ordinary dividends
- Qualified dividends
- Capital gain distributions
- Unrecaptured section 1250 gain
- Section 1202 gain
- Collectibles gain
- Nondividend distribution
- Section 199A dividends
- Foreign tax paid
- Investment expenses
- Federal income tax withheld
- State income tax withheld
- Cash liquidation distributions
- Noncash liquidation distributions
This is what you’re going to find on 1099-DIV. Not all the amounts necessarily mean a taxable amount though. You must know what the taxable portion of your distributions is in order to figure out gross income.
If you think that there are errors on your Form 1099-DIV, you may want to contact the financial institution that issued it. Already filed your tax return? You must file an amended tax return after obtaining the corrected 1099-DIV. This is mandatory since it will affect the taxes owed, thus, your tax refund.
One thing to keep in mind about filing amended tax return not only due to a corrected 1099-DIV but for any other reason, you must file your amended tax return by paper. This ultimately will increase the amount of time it takes for your tax return to be processed but under the IRS guidelines filing an electronic amended tax return isn’t allowed.
If you’re working for a financial institution and need to file Form 1099-DIV to report distributions paid, you can obtain it for the 2021 tax season from here.