IRS Form 1099-DIV
Instructions for 2023

1. Form 1099-DIV Overview

Form 1099-DIV is used to report dividends that were paid during the tax year by a domestic corporation or a foreign corporation that qualifies. If you have paid capital gain dividends, exempt-interest dividends, or other distributions over $10 you will need to file a Form 1099-DIV for this recipient. You will also need to file a Form 1099-DIV if you have withheld any federal income taxes due to backup withholding or foreign taxes on dividends. If you paid $600 in liquidations, you are also required to file Form 1099-DIV.

2. Form 1099-DIV Instructions - A Detailed Look

Form 1099-DIV instructions consist of 15 boxes. This is an overview of the information required in each one.

• In Box 1a is used to report the Total Ordinary Dividends. An ordinary dividend is a payment that is regularly scheduled between a company and its shareholders. This includes dividends from money-market funds, net-short term capital gains, and other stock distributions.
• In Box 1b is used to report the qualified dividends, this is the portion of dividends that qualify for the reduced capital gains rate.

  Enter the total capital gain distribution in Box 2a.

• In Box 2b, enter any amount that you included in Box 2a that is an unrecaptured 1250 gain.
• In Box 2c, enter any amount from Box 2a that is a section 1202 gain from certain qualified small business stock.
• In Box 2d, enter any amount from Box 2a that is considered a 28% rate gain from sales or exchanges of collectibles.
• In Box 2e, enter any amount from Box 1a that is section 897 gain from dispositions of USRPI.
• In Box 2f enter any amount that you included in Box 2a that is considered a section 897 gain from dispositions of USRPI.
• Box 3 enter any non-dividend distributions.

  Enter any backup withholding in Box 4. If the recipient has not provided you with their TIN and has become subject to backup withholding.

  If there are qualified REIT dividends paid by a REIT or section 199A dividends paid by a RIC to the recipient, enter the amount in Box 5.

• Box 6 is used to report investment expenses. This amount must also be included in Box 1a, but not included in Box 1b.

  If any foreign tax was paid on the dividends, enter the amount in Box 7.

  If there is an amount of foreign tax paid in Box 7, enter the country or US Possession that the payment was made to.

• Box 9 is used to report cash liquidation distributions.
• Box 10 is used to report non cash liquidation distributions.
• Box 11 is used to report FATCA Filing Requirement

  Check box, if the payer is reporting the FATCA details on Form(s) 1099 in accordance with FATCA regulations, as described in Regulations section 1.1471-4(d)(2)(iii)(A).

• Box 12 is used to report exempt-interest dividends.

  This box captures the number of tax-exempt dividends the recipient has received from a RIC.

• Box 13 is used to report exempt-interest dividends subject to the alternative minimum tax.

  This box captures the exempt-interest dividends subject to the alternative minimum tax for the amount entered in box 12.

• Box 14-16 are used to report state information.

  In Box 14, enter the state abbreviation, in Box 15 enter the payer’s state ID number, and in Box 16, enter the state income taxes withheld.

3. Understanding the Form 1099-DIV Copies

There are five different copies of the Form 1099-DIV that both payers and their recipients should be aware of:

• Copy A: This is the red copy that is submitted to the IRS
• Copy 1: This is submitted to the State Tax Department
• Copy B: This copy is for the recipient
• Copy 2: This copy should be filed (by the recipient) with the recipient’s state income tax return
• Copy C: This copy is for the payer’s records.

4. E-File Form 1099-DIV with TaxBandits

Once you have all the necessary information at your fingertips, e-filing 1099-DIV with TaxBandits is simple and straightforward. Just follow these steps:

• Create an account with TaxBandits.
• Select or add the business you are filing for.
• Enter the required Form 1099-DIV details.
• Review and transmit Form 1099-DIV to the IRS

Get started with TaxBandits today and stay compliant with the IRS!