Tax question

[Jim3k]

My question relates to a federal tax question that is either esoteric or I am incredibly obtuse. I think it is most likely the latter. If you don’t have any mutual fund holdings, don’t bother reading any further.

In the past, when the fund(s) issued 1099DIV forms, box 2a cited the capital gain distribution amount (if any), which either went straight to the 1040 form or passed through Schedule D. It was an actual understandable liquidated amount.

This year, box 2a, now entitled Total Capital Gain Distribution shows a “total” distributed, not to me, but to the entire universe of fund holders. This is a huge number, far exceeding the value of the holding. Even so, according to the explanatory footnote, we are supposed to run it directly to the 1040 form or through Schedule D—despite the fact that nowhere is there a suggestion that any portion was ever paid to me or reinvested. Did I get a capital gain distribution or not? If so, how is it calculated? Or do I just put a 0 in the capital gain distribution box?

If the entry is correct, where is that big number backed out? If it is not, then I am paying tax on a huge fake number.

So what number do I put in either the 1040 or the Schedule D boxes?

[cspan37421]

That sounds awfully strange. I have a hard time believing your 1099-DIV should have any figures that are fund-level, rather than shareholder-level. Can you piece together your dividends and cap gain distributions from your quarterly statements? Perhaps online distribution information? I've had to do that lately for interest paid that is under $10 for the year. Since interest rates are so low, it's not uncommon for total interest paid to be under $10, and no 1099-INT is generated as a result. You still have to report the number though. So I go through and just add it up from monthly statements. Perhaps you can figure out the right number that way.

If you're using a tax software package, you can see the effect of changing that one figure, right? That should give you a clue as to whether its backed out anywhere else. I rather doubt it is - I think you were given the wrong number. Can't imagine a fund-level figure ever would show up on an individual 1099-DIV.

[77devil]

I've never encountered such a thing. Cannot be correct as you describe it. Call or email the fund company for an explanation. The 1099-DIV boxes should only contain your information. I went back and looked at the 1099 for Vanguard to see if there was aggregate data reported as supplementary information in some other part of the form but found nothing. What is contained in boxes 1a and 1b for total and qualified dividends? They should be your individual amounts as well.

If you receive 1099-DIV from more than one fund company, presumably this issue only occurred with one. Fund and brokerages sometimes issue corrected 1099 forms weeks after the originals, but I'm unaware of a correction for anything like what you describe.

[pfrduke]

This strikes me as a fund error in preparing the 1099-DIV. I would speak with the fund first and see if they can issue a correction.

[gus]

box 2a on a 1099-div should be a sum of all of your dividend amounts cited in 2b, 2c and 2d. are you sure you're not looking at a 2439? That will be a mutual fund or REIT's undistributed capital gains.

[Jim3k]

Thanks for the comments. Let's just say that obtuse describes my ability to misapprehend what was happening with those 1099DIVs--and I won't describe why, since I would only embarrass myself. :mad::o

[gus]

Thanks for the comments. Let's just say that obtuse describes my ability to misapprehend what was happening with those 1099DIVs--and I won't describe why, since I would only embarrass myself. :mad::o

it finally struck you as a weird coincidence that your dividend amount exactly equaled your social security number ;)

[DukieInKansas]

On a similar note - someone I know that works for one of the brokerage firms discovered an error on his 1099, which was also wrong on multiple client's 1099s. They will be receiving corrected forms - which will result in lower income. I believe it was the Capital Gain Distribution box that was in error.