Definition and Example of Form 1099-DIV
Form 1099-DIV reports dividends and distribution income to both the IRS and the taxpayer. Its formal name is "Dividends and Distributions." You'll get a Form 1099-DIV if you receive dividend payments or mutual fund distributions exceeding $10 in a tax year. Your institution must send both you and the IRS a copy of the form by a certain deadline after the tax year closes.
The financial institution must send Form 1099-DIV to you for 2021 dividends and distributions by January 31, 2022. It must send the form to the IRS by February 28, 2022. Reach out to the institution if you don't receive your form by February 1, 2022.
Getting a Form 1099-DIV can sometimes catch you by surprise because you'll receive one even if your dividends or capital gains were automatically reinvested to buy more shares.
Who Uses Form 1099-DIV?
You'll only receive a Form 1099-DIV if your distributions occurred in a taxable account. You won't receive the form for distributions from an individual retirement account (IRA), annuity, pension, or profit-sharing plan. You'll receive Form 1042-S rather than Form 1099-DIV if you're a nonresident alien for tax purposes.
Anyone who receives dividend or capital gains distributions of more than $10 in a taxable account during a calendar year should look for a 1099-DIV.
You should receive a separate Form 1099-DIV for each taxable account where a distribution has occurred. But it doesn't automatically mean that you'll owe taxes on the distribution if you receive one.
Some dividends are qualified dividends, which means that they're taxed at lower long-term capital gains tax rates.
The long-term capital gains tax rate is 0% for single taxpayers with $40,400 or less in taxable income in tax year 2021, the tax return you'll file in 2022. The 0% rate also applies to married couples with an income of $80,800 or less who file a joint tax return. The 15% rate applies to incomes from $40,400, up to $445,850 for single filers. It applies from $80,800 to $501,600 for married taxpayers.
You must include Schedule B when you submit your return if you received more than $1,500 in ordinary (nonqualified) dividends or interest income in a year.
Other Types of Forms 1099
Form 1099-DIV is one of many types of 1099s. A Form 1099 is used to report income to the IRS that doesn't come from a traditional job. These are some other common versions of the 1099 forms you may receive.
Lenders send Form 1099-A to both the homeowner and to the IRS when they foreclose on a property. The IRS treats the balance that you're no longer liable for paying as taxable income.
Creditors use Form 1099-C to report the cancellation of debt. You can expect a 1099-C from any creditor that forgives a balance of $600 or more.
Federal, state, and local governments use Form 1099-G to report certain payments made to taxpayers. This form is used to report unemployment compensation and state or local income tax offsets, credits, or deductions.
Banks and financial institutions use Form 1099-INT to report interest income. You'll receive one of these if you earned interest of $10 or more on a savings account, money market account, or certificate of deposit (CD).
Form 1099-MISC is used to report a variety of income sources, including salesperson incentive payments, prizes and awards, compensation for jury duty, or taxable damages from a lawsuit. It's also used to report rents paid, medical and attorney payments, and some types of transactions related to agriculture and fishing. This was the form companies used for reporting payments to contractors and freelancers prior to 2020. But these workers now have their own form.
Companies now use Form 1099-NEC instead of Form 1099-MISC to report payments to independent contractors and freelancers. You should receive the form from any company that paid you $600 or more in a tax year.
Form 1099-R is used to report distributions over $10 from a retirement account or annuity. You'll receive the form even when the distribution isn't taxable.
Form SSA-1099 is used to report Social Security benefits, even if they're not taxable.
Where To Get a Form 1099-DIV
Most investors receive Form 1099-DIV in the mail. But many companies allow you access to your tax forms online, including Form 1099-DIV, so you may be able to find it by logging in to your account.
What To Do If You Don't Receive Form 1099-DIV
Contact your brokerage company if you don't receive a Form 1099-DIV in the mail, and you don't see it when you log in to your account. Some companies will only send you the form if your distributions were $10 or more. Your gains may be less than $10 for extremely low-yield investments such as money market funds, particularly when interest rates are low.
You're still responsible for reporting the income to the IRS even if you don't receive a Form 1099-DIV. You can find the amount of any distributions by logging in to your investment account.
How To File Form 1099-DIV
You don't have to file Form 1099-DIV with your tax return. The institution has already forwarded one to the IRS. But you must report the information it contains on your return. You can report it directly on Form 1040 if your dividend or interest income is less than $1,500. You must report it on a Schedule B if your distributions exceed $1,500.
Consult with a tax professional if you're not sure how to handle Form 1099-DIV. The form includes your Social Security number or taxpayer identification number, so the IRS will know about this income even if you don't report it.
- You'll receive a Form 1099-DIV if you have dividends or mutual fund distributions of more than $10 during the tax year.
- You don't have to file Form 1099-DIV with your tax return. But you'll need the information it contains when you prepare your return.
- Receiving Form 1099-DIV doesn't always mean you owe taxes on a distribution.
- You won't receive Form 1099-DIV for distributions that occurred in a tax-advantaged account such as a 401(k) or IRA.
- You must file a Schedule B with your tax return if your dividend payments exceed $1,500 for the year.