Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Amend Tax Return Instructions

Free Tax Usa Coupon CodeH&r Block Free EfileFiling Back TaxHow To Fill Out 1040ez 2012Hrblock Free FileDo State TaxesFile 1040nr Online FreeDownload Tax Forms 2011How To Amend Your 2012 Tax Return2010 New Car Tax CreditAmend My 2011 TaxesForm 1040nr InstructionsForm 1040 V Payment VoucherTax Deadline1040x Amended Return FormIrs Tax Forms For 2009Amended ReturnHow To Fill Out 1040x Form2013 1040ez InstructionsHow To File State And Federal Taxes For Free Online1040x ExampleFree State Tax Only E FilingFree State Tax Filing Turbotax CodeFile Taxes 20111040ez WorksheetAmended Form 1040xIrs Free E File 2011Free 2012 Tax FormsWhat Is A 1040xAmendment Tax Return 20121040v Tax FormDo I Have To File A State Tax ReturnFile Past Taxes Online1040ez Tax FormForm 1040ez 2014Past Year Tax FormsI Need To Amend My 2013 Tax ReturnIrs 1040 Ez Form 2012Free Income Tax FilingCan Tax Form 1040x Be Filed Online

Amend Tax Return Instructions

Amend tax return instructions Publication 721 - Additional Material Prev  Up  Next   Home   More Online Publications
Español

Special Forces Operations Command

Special Forces Operations Command oversees the special operations capabilities of the various military branches, coordinates their training, strategy, interoperability and operations.

Contact the Agency or Department

Website: Special Forces Operations Command

E-mail: (Media Inquiries)

Address: 7701 Tampa Point Blvd
MacDill Air Force Base, FL 33621

Phone Number: (813) 826-4600 (Media Inquiries)

The Amend Tax Return Instructions

Amend tax return instructions 8. Amend tax return instructions   Dividends and Other Distributions Table of Contents Reminder Introduction Useful Items - You may want to see: General InformationDividends not reported on Form 1099-DIV. Amend tax return instructions Reporting tax withheld. Amend tax return instructions Nominees. Amend tax return instructions Ordinary DividendsQualified Dividends Dividends Used to Buy More Stock Money Market Funds Capital Gain DistributionsBasis adjustment. Amend tax return instructions Nondividend DistributionsLiquidating Distributions Distributions of Stock and Stock Rights Other DistributionsInformation reporting requirement. Amend tax return instructions Alternative minimum tax treatment. Amend tax return instructions How To Report Dividend IncomeInvestment interest deducted. Amend tax return instructions Reminder Foreign-source income. Amend tax return instructions  If you are a U. Amend tax return instructions S. Amend tax return instructions citizen with dividend income from sources outside the United States (foreign-source income), you must report that income on your tax return unless it is exempt by U. Amend tax return instructions S. Amend tax return instructions law. Amend tax return instructions This is true whether you reside inside or outside the United States and whether or not you receive a Form 1099 from the foreign payer. Amend tax return instructions Introduction This chapter discusses the tax treatment of: Ordinary dividends, Capital gain distributions, Nondividend distributions, and Other distributions you may receive from a corporation or a mutual fund. Amend tax return instructions This chapter also explains how to report dividend income on your tax return. Amend tax return instructions Dividends are distributions of money, stock, or other property paid to you by a corporation or by a mutual fund. Amend tax return instructions You also may receive dividends through a partnership, an estate, a trust, or an association that is taxed as a corporation. Amend tax return instructions However, some amounts you receive that are called dividends are actually interest income. Amend tax return instructions (See Dividends that are actually interest under Taxable Interest in chapter 7. Amend tax return instructions ) Most distributions are paid in cash (or check). Amend tax return instructions However, distributions can consist of more stock, stock rights, other property, or services. Amend tax return instructions Useful Items - You may want to see: Publication 514 Foreign Tax Credit for Individuals 550 Investment Income and Expenses Form (and Instructions) Schedule B (Form 1040A or 1040) Interest and Ordinary Dividends General Information This section discusses general rules for dividend income. Amend tax return instructions Tax on unearned income of certain children. Amend tax return instructions   Part of a child's 2013 unearned income may be taxed at the parent's tax rate. Amend tax return instructions If it is, Form 8615, Tax for Certain Children Who Have Unearned Income, must be completed and attached to the child's tax return. Amend tax return instructions If not, Form 8615 is not required and the child's income is taxed at his or her own tax rate. Amend tax return instructions    Some parents can choose to include the child's interest and dividends on the parent's return if certain requirements are met. Amend tax return instructions Use Form 8814, Parents' Election To Report Child's Interest and Dividends, for this purpose. Amend tax return instructions   For more information about the tax on unearned income of children and the parents' election, see chapter 31. Amend tax return instructions Beneficiary of an estate or trust. Amend tax return instructions    Dividends and other distributions you receive as a beneficiary of an estate or trust are generally taxable income. Amend tax return instructions You should receive a Schedule K-1 (Form 1041), Beneficiary's Share of Income, Deductions, Credits, etc. Amend tax return instructions , from the fiduciary. Amend tax return instructions Your copy of Schedule K-1 (Form 1041) and its instructions will tell you where to report the income on your Form 1040. Amend tax return instructions Social security number (SSN) or individual taxpayer identification number (ITIN). Amend tax return instructions    You must give your SSN or ITIN to any person required by federal tax law to make a return, statement, or other document that relates to you. Amend tax return instructions This includes payers of dividends. Amend tax return instructions If you do not give your SSN or ITIN to the payer of dividends, you may have to pay a penalty. Amend tax return instructions For more information on SSNs and ITINs, see Social Security Number (SSN) in chapter 1. Amend tax return instructions Backup withholding. Amend tax return instructions   Your dividend income is generally not subject to regular withholding. Amend tax return instructions However, it may be subject to backup withholding to ensure that income tax is collected on the income. Amend tax return instructions Under backup withholding, the payer of dividends must withhold, as income tax, on the amount you are paid, applying the appropriate withholding rate. Amend tax return instructions   Backup withholding may also be required if the IRS has determined that you underreported your interest or dividend income. Amend tax return instructions For more information, see Backup Withholding in chapter 4. Amend tax return instructions Stock certificate in two or more names. Amend tax return instructions   If two or more persons hold stock as joint tenants, tenants by the entirety, or tenants in common, each person's share of any dividends from the stock is determined by local law. Amend tax return instructions Form 1099-DIV. Amend tax return instructions   Most corporations and mutual funds use Form 1099-DIV, Dividends and Distributions, to show you the distributions you received from them during the year. Amend tax return instructions Keep this form with your records. Amend tax return instructions You do not have to attach it to your tax return. Amend tax return instructions Dividends not reported on Form 1099-DIV. Amend tax return instructions   Even if you do not receive Form 1099-DIV, you must still report all your taxable dividend income. Amend tax return instructions For example, you may receive distributive shares of dividends from partnerships or S corporations. Amend tax return instructions These dividends are reported to you on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Amend tax return instructions , and Schedule K-1 (Form 1120S), Shareholder's Share of Income, Deductions, Credits, etc. Amend tax return instructions Reporting tax withheld. Amend tax return instructions   If tax is withheld from your dividend income, the payer must give you a Form 1099-DIV that indicates the amount withheld. Amend tax return instructions Nominees. Amend tax return instructions   If someone receives distributions as a nominee for you, that person should give you a Form 1099-DIV, which will show distributions received on your behalf. Amend tax return instructions Form 1099-MISC. Amend tax return instructions   Certain substitute payments in lieu of dividends or tax-exempt interest received by a broker on your behalf must be reported to you on Form 1099-MISC, Miscellaneous Income, or a similar statement. Amend tax return instructions See Reporting Substitute Payments under Short Sales in chapter 4 of Publication 550 for more information about reporting these payments. Amend tax return instructions Incorrect amount shown on a Form 1099. Amend tax return instructions   If you receive a Form 1099 that shows an incorrect amount (or other incorrect information), you should ask the issuer for a corrected form. Amend tax return instructions The new Form 1099 you receive will be marked “Corrected. Amend tax return instructions ” Dividends on stock sold. Amend tax return instructions   If stock is sold, exchanged, or otherwise disposed of after a dividend is declared but before it is paid, the owner of record (usually the payee shown on the dividend check) must include the dividend in income. Amend tax return instructions Dividends received in January. Amend tax return instructions   If a mutual fund (or other regulated investment company) or real estate investment trust (REIT) declares a dividend (including any exempt-interest dividend or capital gain distribution) in October, November, or December, payable to shareholders of record on a date in one of those months but actually pays the dividend during January of the next calendar year, you are considered to have received the dividend on December 31. Amend tax return instructions You report the dividend in the year it was declared. Amend tax return instructions Ordinary Dividends Ordinary (taxable) dividends are the most common type of distribution from a corporation or a mutual fund. Amend tax return instructions They are paid out of earnings and profits and are ordinary income to you. Amend tax return instructions This means they are not capital gains. Amend tax return instructions You can assume that any dividend you receive on common or preferred stock is an ordinary dividend unless the paying corporation or mutual fund tells you otherwise. Amend tax return instructions Ordinary dividends will be shown in box 1a of the Form 1099-DIV you receive. Amend tax return instructions Qualified Dividends Qualified dividends are the ordinary dividends subject to the same 0%, 15%, or 20% maximum tax rate that applies to net capital gain. Amend tax return instructions They should be shown in box 1b of the Form 1099-DIV you receive. Amend tax return instructions The maximum rate of tax on qualified dividends is: 0% on any amount that otherwise would be taxed at a 10% or 15% rate. Amend tax return instructions 15% on any amount that otherwise would be taxed at rates greater than 15% but less than 39. Amend tax return instructions 6%. Amend tax return instructions 20% on any amount that otherwise would be taxed at a 39. Amend tax return instructions 6% rate. Amend tax return instructions To qualify for the maximum rate, all of the following requirements must be met. Amend tax return instructions The dividends must have been paid by a U. Amend tax return instructions S. Amend tax return instructions corporation or a qualified foreign corporation. Amend tax return instructions (See Qualified foreign corporation , later. Amend tax return instructions ) The dividends are not of the type listed later under Dividends that are not qualified dividends . Amend tax return instructions You meet the holding period (discussed next). Amend tax return instructions Holding period. Amend tax return instructions   You must have held the stock for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date. Amend tax return instructions The ex-dividend date is the first date following the declaration of a dividend on which the buyer of a stock is not entitled to receive the next dividend payment. Amend tax return instructions Instead, the seller will get the dividend. Amend tax return instructions   When counting the number of days you held the stock, include the day you disposed of the stock, but not the day you acquired it. Amend tax return instructions See the examples later. Amend tax return instructions Exception for preferred stock. Amend tax return instructions   In the case of preferred stock, you must have held the stock more than 90 days during the 181-day period that begins 90 days before the ex-dividend date if the dividends are due to periods totaling more than 366 days. Amend tax return instructions If the preferred dividends are due to periods totaling less than 367 days, the holding period in the previous paragraph applies. Amend tax return instructions Example 1. Amend tax return instructions You bought 5,000 shares of XYZ Corp. Amend tax return instructions common stock on July 9, 2013. Amend tax return instructions XYZ Corp. Amend tax return instructions paid a cash dividend of 10 cents per share. Amend tax return instructions The ex-dividend date was July 16, 2013. Amend tax return instructions Your Form 1099-DIV from XYZ Corp. Amend tax return instructions shows $500 in box 1a (ordinary dividends) and in box 1b (qualified dividends). Amend tax return instructions However, you sold the 5,000 shares on August 12, 2013. Amend tax return instructions You held your shares of XYZ Corp. Amend tax return instructions for only 34 days of the 121-day period (from July 10, 2013, through August 12, 2013). Amend tax return instructions The 121-day period began on May 17, 2013 (60 days before the ex-dividend date), and ended on September 14, 2013. Amend tax return instructions You have no qualified dividends from XYZ Corp. Amend tax return instructions because you held the XYZ stock for less than 61 days. Amend tax return instructions Example 2. Amend tax return instructions Assume the same facts as in Example 1 except that you bought the stock on July 15, 2013 (the day before the ex-dividend date), and you sold the stock on September 16, 2013. Amend tax return instructions You held the stock for 63 days (from July 16, 2013, through September 16, 2013). Amend tax return instructions The $500 of qualified dividends shown in box 1b of your Form 1099-DIV are all qualified dividends because you held the stock for 61 days of the 121-day period (from July 16, 2013, through September 14, 2013). Amend tax return instructions Example 3. Amend tax return instructions You bought 10,000 shares of ABC Mutual Fund common stock on July 9, 2013. Amend tax return instructions ABC Mutual Fund paid a cash dividend of 10 cents a share. Amend tax return instructions The ex-dividend date was July 16, 2013. Amend tax return instructions The ABC Mutual Fund advises you that the portion of the dividend eligible to be treated as qualified dividends equals 2 cents per share. Amend tax return instructions Your Form 1099-DIV from ABC Mutual Fund shows total ordinary dividends of $1,000 and qualified dividends of $200. Amend tax return instructions However, you sold the 10,000 shares on August 12, 2013. Amend tax return instructions You have no qualified dividends from ABC Mutual Fund because you held the ABC Mutual Fund stock for less than 61 days. Amend tax return instructions Holding period reduced where risk of loss is diminished. Amend tax return instructions   When determining whether you met the minimum holding period discussed earlier, you cannot count any day during which you meet any of the following conditions. Amend tax return instructions You had an option to sell, were under a contractual obligation to sell, or had made (and not closed) a short sale of substantially identical stock or securities. Amend tax return instructions You were grantor (writer) of an option to buy substantially identical stock or securities. Amend tax return instructions Your risk of loss is diminished by holding one or more other positions in substantially similar or related property. Amend tax return instructions   For information about how to apply condition (3), see Regulations section 1. Amend tax return instructions 246-5. Amend tax return instructions Qualified foreign corporation. Amend tax return instructions   A foreign corporation is a qualified foreign corporation if it meets any of the following conditions. Amend tax return instructions The corporation is incorporated in a U. Amend tax return instructions S. Amend tax return instructions possession. Amend tax return instructions The corporation is eligible for the benefits of a comprehensive income tax treaty with the United States that the Treasury Department determines is satisfactory for this purpose and that includes an exchange of information program. Amend tax return instructions For a list of those treaties, see Table 8-1. Amend tax return instructions The corporation does not meet (1) or (2) above, but the stock for which the dividend is paid is readily tradable on an established securities market in the United States. Amend tax return instructions See Readily tradable stock , later. Amend tax return instructions Exception. Amend tax return instructions   A corporation is not a qualified foreign corporation if it is a passive foreign investment company during its tax year in which the dividends are paid or during its previous tax year. Amend tax return instructions Readily tradable stock. Amend tax return instructions   Any stock (such as common, ordinary, or preferred) or an American depositary receipt in respect of that stock is considered to satisfy requirement (3) under Qualified foreign corporation , if it is listed on a national securities exchange that is registered under section 6 of the Securities Exchange Act of 1934 or on the Nasdaq Stock Market. Amend tax return instructions For a list of the exchanges that meet these requirements, see www. Amend tax return instructions sec. Amend tax return instructions gov/divisions/marketreg/mrexchanges. Amend tax return instructions shtml. Amend tax return instructions Dividends that are not qualified dividends. Amend tax return instructions   The following dividends are not qualified dividends. Amend tax return instructions They are not qualified dividends even if they are shown in box 1b of Form 1099-DIV. Amend tax return instructions Capital gain distributions. Amend tax return instructions Dividends paid on deposits with mutual savings banks, cooperative banks, credit unions, U. Amend tax return instructions S. Amend tax return instructions building and loan associations, U. Amend tax return instructions S. Amend tax return instructions savings and loan associations, federal savings and loan associations, and similar financial institutions. Amend tax return instructions (Report these amounts as interest income. Amend tax return instructions ) Dividends from a corporation that is a tax-exempt organization or farmer's cooperative during the corporation's tax year in which the dividends were paid or during the corporation's previous tax year. Amend tax return instructions Dividends paid by a corporation on employer securities held on the date of record by an employee stock ownership plan (ESOP) maintained by that corporation. Amend tax return instructions Dividends on any share of stock to the extent you are obligated (whether under a short sale or otherwise) to make related payments for positions in substantially similar or related property. Amend tax return instructions Payments in lieu of dividends, but only if you know or have reason to know the payments are not qualified dividends. Amend tax return instructions Payments shown in Form 1099-DIV, box 1b, from a foreign corporation to the extent you know or have reason to know the payments are not qualified dividends. Amend tax return instructions Table 8-1. Amend tax return instructions Income Tax Treaties Income tax treaties the United States has with the following countries satisfy requirement (2) under Qualified foreign corporation. Amend tax return instructions Australia Indonesia Romania Austria Ireland Russian Bangladesh Israel Federation Barbados Italy Slovak Belgium Jamaica Republic Bulgaria Japan Slovenia Canada Kazakhstan South Africa China Korea Spain Cyprus Latvia Sri Lanka Czech Lithuania Sweden Republic Luxembourg Switzerland Denmark Malta Thailand Egypt Mexico Trinidad and Estonia Morocco Tobago Finland Netherlands Tunisia France New Zealand Turkey Germany Norway Ukraine Greece Pakistan United Hungary Philippines Kingdom Iceland Poland Venezuela India Portugal     Dividends Used to Buy More Stock The corporation in which you own stock may have a dividend reinvestment plan. Amend tax return instructions This plan lets you choose to use your dividends to buy (through an agent) more shares of stock in the corporation instead of receiving the dividends in cash. Amend tax return instructions Most mutual funds also permit shareholders to automatically reinvest distributions in more shares in the fund, instead of receiving cash. Amend tax return instructions If you use your dividends to buy more stock at a price equal to its fair market value, you still must report the dividends as income. Amend tax return instructions If you are a member of a dividend reinvestment plan that lets you buy more stock at a price less than its fair market value, you must report as dividend income the fair market value of the additional stock on the dividend payment date. Amend tax return instructions You also must report as dividend income any service charge subtracted from your cash dividends before the dividends are used to buy the additional stock. Amend tax return instructions But you may be able to deduct the service charge. Amend tax return instructions See chapter 28 for more information about deducting expenses of producing income. Amend tax return instructions In some dividend reinvestment plans, you can invest more cash to buy shares of stock at a price less than fair market value. Amend tax return instructions If you choose to do this, you must report as dividend income the difference between the cash you invest and the fair market value of the stock you buy. Amend tax return instructions When figuring this amount, use the fair market value of the stock on the dividend payment date. Amend tax return instructions Money Market Funds Report amounts you receive from money market funds as dividend income. Amend tax return instructions Money market funds are a type of mutual fund and should not be confused with bank money market accounts that pay interest. Amend tax return instructions Capital Gain Distributions Capital gain distributions (also called capital gain dividends) are paid to you or credited to your account by mutual funds (or other regulated investment companies) and real estate investment trusts (REITs). Amend tax return instructions They will be shown in box 2a of the Form 1099-DIV you receive from the mutual fund or REIT. Amend tax return instructions Report capital gain distributions as long-term capital gains, regardless of how long you owned your shares in the mutual fund or REIT. Amend tax return instructions Undistributed capital gains of mutual funds and REITs. Amend tax return instructions    Some mutual funds and REITs keep their long-term capital gains and pay tax on them. Amend tax return instructions You must treat your share of these gains as distributions, even though you did not actually receive them. Amend tax return instructions However, they are not included on Form 1099-DIV. Amend tax return instructions Instead, they are reported to you in box 1a of Form 2439. Amend tax return instructions   Report undistributed capital gains (box 1a of Form 2439) as long-term capital gains on Schedule D (Form 1040), column (h), line 11. Amend tax return instructions   The tax paid on these gains by the mutual fund or REIT is shown in box 2 of Form 2439. Amend tax return instructions You take credit for this tax by including it on Form 1040, line 71, and checking box a on that line. Amend tax return instructions Attach Copy B of Form 2439 to your return, and keep Copy C for your records. Amend tax return instructions Basis adjustment. Amend tax return instructions   Increase your basis in your mutual fund, or your interest in a REIT, by the difference between the gain you report and the credit you claim for the tax paid. Amend tax return instructions Additional information. Amend tax return instructions   For more information on the treatment of distributions from mutual funds, see Publication 550. Amend tax return instructions Nondividend Distributions A nondividend distribution is a distribution that is not paid out of the earnings and profits of a corporation or a mutual fund. Amend tax return instructions You should receive a Form 1099-DIV or other statement showing the nondividend distribution. Amend tax return instructions On Form 1099-DIV, a nondividend distribution will be shown in box 3. Amend tax return instructions If you do not receive such a statement, you report the distribution as an ordinary dividend. Amend tax return instructions Basis adjustment. Amend tax return instructions   A nondividend distribution reduces the basis of your stock. Amend tax return instructions It is not taxed until your basis in the stock is fully recovered. Amend tax return instructions This nontaxable portion is also called a return of capital; it is a return of your investment in the stock of the company. Amend tax return instructions If you buy stock in a corporation in different lots at different times, and you cannot definitely identify the shares subject to the nondividend distribution, reduce the basis of your earliest purchases first. Amend tax return instructions   When the basis of your stock has been reduced to zero, report any additional nondividend distribution you receive as a capital gain. Amend tax return instructions Whether you report it as a long-term or short-term capital gain depends on how long you have held the stock. Amend tax return instructions See Holding Period in chapter 14. Amend tax return instructions Example. Amend tax return instructions You bought stock in 2000 for $100. Amend tax return instructions In 2003, you received a nondividend distribution of $80. Amend tax return instructions You did not include this amount in your income, but you reduced the basis of your stock to $20. Amend tax return instructions You received a nondividend distribution of $30 in 2013. Amend tax return instructions The first $20 of this amount reduced your basis to zero. Amend tax return instructions You report the other $10 as a long-term capital gain for 2013. Amend tax return instructions You must report as a long-term capital gain any nondividend distribution you receive on this stock in later years. Amend tax return instructions Liquidating Distributions Liquidating distributions, sometimes called liquidating dividends, are distributions you receive during a partial or complete liquidation of a corporation. Amend tax return instructions These distributions are, at least in part, one form of a return of capital. Amend tax return instructions They may be paid in one or more installments. Amend tax return instructions You will receive Form 1099-DIV from the corporation showing you the amount of the liquidating distribution in box 8 or 9. Amend tax return instructions For more information on liquidating distributions, see chapter 1 of Publication 550. Amend tax return instructions Distributions of Stock and Stock Rights Distributions by a corporation of its own stock are commonly known as stock dividends. Amend tax return instructions Stock rights (also known as “stock options”) are distributions by a corporation of rights to acquire the corporation's stock. Amend tax return instructions Generally, stock dividends and stock rights are not taxable to you, and you do not report them on your return. Amend tax return instructions Taxable stock dividends and stock rights. Amend tax return instructions   Distributions of stock dividends and stock rights are taxable to you if any of the following apply. Amend tax return instructions You or any other shareholder have the choice to receive cash or other property instead of stock or stock rights. Amend tax return instructions The distribution gives cash or other property to some shareholders and an increase in the percentage interest in the corporation's assets or earnings and profits to other shareholders. Amend tax return instructions The distribution is in convertible preferred stock and has the same result as in (2). Amend tax return instructions The distribution gives preferred stock to some common stock shareholders and common stock to other common stock shareholders. Amend tax return instructions The distribution is on preferred stock. Amend tax return instructions (The distribution, however, is not taxable if it is an increase in the conversion ratio of convertible preferred stock made solely to take into account a stock dividend, stock split, or similar event that would otherwise result in reducing the conversion right. Amend tax return instructions )   The term “stock” includes rights to acquire stock, and the term “shareholder” includes a holder of rights or of convertible securities. Amend tax return instructions If you receive taxable stock dividends or stock rights, include their fair market value at the time of distribution in your income. Amend tax return instructions Preferred stock redeemable at a premium. Amend tax return instructions   If you hold preferred stock having a redemption price higher than its issue price, the difference (the redemption premium) generally is taxable as a constructive distribution of additional stock on the preferred stock. Amend tax return instructions For more information, see chapter 1 of Publication 550. Amend tax return instructions Basis. Amend tax return instructions   Your basis in stock or stock rights received in a taxable distribution is their fair market value when distributed. Amend tax return instructions If you receive stock or stock rights that are not taxable to you, see Stocks and Bonds under Basis of Investment Property in chapter 4 of Publication 550 for information on how to figure their basis. Amend tax return instructions Fractional shares. Amend tax return instructions    You may not own enough stock in a corporation to receive a full share of stock if the corporation declares a stock dividend. Amend tax return instructions However, with the approval of the shareholders, the corporation may set up a plan in which fractional shares are not issued but instead are sold, and the cash proceeds are given to the shareholders. Amend tax return instructions Any cash you receive for fractional shares under such a plan is treated as an amount realized on the sale of the fractional shares. Amend tax return instructions Report this transaction on Form 8949, Sales and Other Dispositions of Capital Assets. Amend tax return instructions Enter your gain or loss, the difference between the cash you receive and the basis of the fractional shares sold, in column (h) of Schedule D (Form 1040) in Part I or Part II, whichever is appropriate. Amend tax return instructions    Report these transactions on Form 8949 with the correct box checked. Amend tax return instructions   For more information on Form 8949 and Schedule D (Form 1040), see chapter 4 of Publication 550. Amend tax return instructions Also see the Instructions for Form 8949 and the Instructions for Schedule D (Form 1040). Amend tax return instructions Example. Amend tax return instructions You own one share of common stock that you bought on January 3, 2004, for $100. Amend tax return instructions The corporation declared a common stock dividend of 5% on June 29, 2013. Amend tax return instructions The fair market value of the stock at the time the stock dividend was declared was $200. Amend tax return instructions You were paid $10 for the fractional-share stock dividend under a plan described in the discussion above. Amend tax return instructions You figure your gain or loss as follows: Fair market value of old stock $200. Amend tax return instructions 00 Fair market value of stock dividend (cash received) +10. Amend tax return instructions 00 Fair market value of old stock and stock dividend $210. Amend tax return instructions 00 Basis (cost) of old stock after the stock dividend (($200 ÷ $210) × $100) $95. Amend tax return instructions 24 Basis (cost) of stock dividend (($10 ÷ $210) × $100) + 4. Amend tax return instructions 76 Total $100. Amend tax return instructions 00 Cash received $10. Amend tax return instructions 00 Basis (cost) of stock dividend − 4. Amend tax return instructions 76 Gain $5. Amend tax return instructions 24 Because you had held the share of stock for more than 1 year at the time the stock dividend was declared, your gain on the stock dividend is a long-term capital gain. Amend tax return instructions Scrip dividends. Amend tax return instructions   A corporation that declares a stock dividend may issue you a scrip certificate that entitles you to a fractional share. Amend tax return instructions The certificate is generally nontaxable when you receive it. Amend tax return instructions If you choose to have the corporation sell the certificate for you and give you the proceeds, your gain or loss is the difference between the proceeds and the portion of your basis in the corporation's stock allocated to the certificate. Amend tax return instructions   However, if you receive a scrip certificate that you can choose to redeem for cash instead of stock, the certificate is taxable when you receive it. Amend tax return instructions You must include its fair market value in income on the date you receive it. Amend tax return instructions Other Distributions You may receive any of the following distributions during the year. Amend tax return instructions Exempt-interest dividends. Amend tax return instructions   Exempt-interest dividends you receive from a mutual fund or other regulated investment company, including those received from a qualified fund of funds in any tax year beginning after December 22, 2010, are not included in your taxable income. Amend tax return instructions Exempt-interest dividends should be shown in box 10 of Form 1099-DIV. Amend tax return instructions Information reporting requirement. Amend tax return instructions   Although exempt-interest dividends are not taxable, you must show them on your tax return if you have to file a return. Amend tax return instructions This is an information reporting requirement and does not change the exempt-interest dividends to taxable income. Amend tax return instructions Alternative minimum tax treatment. Amend tax return instructions   Exempt-interest dividends paid from specified private activity bonds may be subject to the alternative minimum tax. Amend tax return instructions See Alternative Minimum Tax (AMT) in chapter 30 for more information. Amend tax return instructions Dividends on insurance policies. Amend tax return instructions    Insurance policy dividends the insurer keeps and uses to pay your premiums are not taxable. Amend tax return instructions However, you must report as taxable interest income the interest that is paid or credited on dividends left with the insurance company. Amend tax return instructions    If dividends on an insurance contract (other than a modified endowment contract) are distributed to you, they are a partial return of the premiums you paid. Amend tax return instructions Do not include them in your gross income until they are more than the total of all net premiums you paid for the contract. Amend tax return instructions Report any taxable distributions on insurance policies on Form 1040, line 21. Amend tax return instructions Dividends on veterans' insurance. Amend tax return instructions   Dividends you receive on veterans' insurance policies are not taxable. Amend tax return instructions In addition, interest on dividends left with the Department of Veterans Affairs is not taxable. Amend tax return instructions Patronage dividends. Amend tax return instructions   Generally, patronage dividends you receive in money from a cooperative organization are included in your income. Amend tax return instructions   Do not include in your income patronage dividends you receive on: Property bought for your personal use, or Capital assets or depreciable property bought for use in your business. Amend tax return instructions But you must reduce the basis (cost) of the items bought. Amend tax return instructions If the dividend is more than the adjusted basis of the assets, you must report the excess as income. Amend tax return instructions   These rules are the same whether the cooperative paying the dividend is a taxable or tax-exempt cooperative. Amend tax return instructions Alaska Permanent Fund dividends. Amend tax return instructions    Do not report these amounts as dividends. Amend tax return instructions Instead, report these amounts on Form 1040, line 21; Form 1040A, line 13; or Form 1040EZ, line 3. Amend tax return instructions How To Report Dividend Income Generally, you can use either Form 1040 or Form 1040A to report your dividend income. Amend tax return instructions Report the total of your ordinary dividends on line 9a of Form 1040 or Form 1040A. Amend tax return instructions Report qualified dividends on line 9b of Form 1040 or Form 1040A. Amend tax return instructions If you receive capital gain distributions, you may be able to use Form 1040A or you may have to use Form 1040. Amend tax return instructions See Exceptions to filing Form 8949 and Schedule D (Form 1040) in chapter 16. Amend tax return instructions If you receive nondividend distributions required to be reported as capital gains, you must use Form 1040. Amend tax return instructions You cannot use Form 1040EZ if you receive any dividend income. Amend tax return instructions Form 1099-DIV. Amend tax return instructions   If you owned stock on which you received $10 or more in dividends and other distributions, you should receive a Form 1099-DIV. Amend tax return instructions Even if you do not receive Form 1099-DIV, you must report all your dividend income. Amend tax return instructions   See Form 1099-DIV for more information on how to report dividend income. Amend tax return instructions Form 1040A or 1040. Amend tax return instructions    You must complete Schedule B (Form 1040A or 1040), Part II, and attach it to your Form 1040A or 1040, if: Your ordinary dividends (Form 1099-DIV, box 1a) are more than $1,500, or You received, as a nominee, dividends that actually belong to someone else. Amend tax return instructions If your ordinary dividends are more than $1,500, you must also complete Schedule B (Form 1040A or 1040), Part III. Amend tax return instructions   List on Schedule B (Form 1040A or 1040), Part II, line 5, each payer's name and the ordinary dividends you received. Amend tax return instructions If your securities are held by a brokerage firm (in “street name”), list the name of the brokerage firm shown on Form 1099-DIV as the payer. Amend tax return instructions If your stock is held by a nominee who is the owner of record, and the nominee credited or paid you dividends on the stock, show the name of the nominee and the dividends you received or for which you were credited. Amend tax return instructions   Enter on line 6 the total of the amounts listed on line 5. Amend tax return instructions Also enter this total on line 9a of Form 1040A or 1040. Amend tax return instructions Qualified dividends. Amend tax return instructions   Report qualified dividends (Form 1099-DIV, box 1b) on line 9b of Form 1040 or Form 1040A. Amend tax return instructions The amount in box 1b is already included in box 1a. Amend tax return instructions Do not add the amount in box 1b to, or substract it from, the amount in box 1a. Amend tax return instructions   Do not include any of the following on line 9b. Amend tax return instructions Qualified dividends you received as a nominee. Amend tax return instructions See Nominees under How to Report Dividend Income in chapter 1 of Publication 550. Amend tax return instructions Dividends on stock for which you did not meet the holding period. Amend tax return instructions See Holding period , earlier under Qualified Dividends. Amend tax return instructions Dividends on any share of stock to the extent you are obligated (whether under a short sale or otherwise) to make related payments for positions in substantially similar or related property. Amend tax return instructions Payments in lieu of dividends, but only if you know or have reason to know the payments are not qualified dividends. Amend tax return instructions Payments shown in Form 1099-DIV, box 1b, from a foreign corporation to the extent you know or have reason to know the payments are not qualified dividends. Amend tax return instructions   If you have qualified dividends, you must figure your tax by completing the Qualified Dividends and Capital Gain Tax Worksheet in the Form 1040 or 1040A instructions or the Schedule D Tax Worksheet in the Schedule D (Form 1040) instructions, whichever applies. Amend tax return instructions Enter qualified dividends on line 2 of the worksheet. Amend tax return instructions Investment interest deducted. Amend tax return instructions   If you claim a deduction for investment interest, you may have to reduce the amount of your qualified dividends that are eligible for the 0%, 15%, or 20% tax rate. Amend tax return instructions Reduce it by the qualified dividends you choose to include in investment income when figuring the limit on your investment interest deduction. Amend tax return instructions This is done on the Qualified Dividends and Capital Gain Tax Worksheet or the Schedule D Tax Worksheet. Amend tax return instructions For more information about the limit on investment interest, see Investment expenses in chapter 23. Amend tax return instructions Expenses related to dividend income. Amend tax return instructions   You may be able to deduct expenses related to dividend income if you itemize your deductions on Schedule A (Form 1040). Amend tax return instructions See chapter 28 for general information about deducting expenses of producing income. Amend tax return instructions More information. Amend tax return instructions    For more information about how to report dividend income, see chapter 1 of Publication 550 or the instructions for the form you must file. Amend tax return instructions Prev  Up  Next   Home   More Online Publications