| Forms to use |
1099-Div Information Statement
1096 Transmittal Form |
|
| How often? |
|
Annual reporting requirement |
|
| Due date | |
January 31 to the recipient |
|
| To complete IRS 1099-Div | |
| 1099's should be typed. Prepare a 1099 for each shareholder. |
| Lines | What to enter |
| Left side | - Payer is your corporation
- The recipient is your shareholder.
- Payer's federal identification number is the number you received from filing the SS-4 form.
- Recipients' identification number is their social security number.
- Leave "Account Number" blank unless you keep track of your shareholders through account numbers.
|
| Right side | - Box 1 is for total dividends paid.
There are two types of dividends: ordinary dividends and capital gain distributions.
Ordinary dividends come from the corporation's net income for that year. The total should be put
in Box 1b. Capital gain distributions come from two sources: income from prior years that
was reinvested into the company and payback of initial investment. Total capital gain distributions
should be put in Box 1c. The sum of Box 1b plus Box 1c should equal Box 1.
Note: Shareholders are not taxed on capital gains that are a payback of initial investment.
However, the shareholder, not the corporation, is responsible for determining at what point
the value (basis) of their initial investment is being liquidated.
- Use Box 2 if you withheld income tax on behalf of your shareholders.
- Generally, the other boxes are 0.
|
|
|
| How to complete form 1096 | |
1096's should be typed. Prepare one form to transmit all the 1099-Div.
| Line | What to do |
| Box 1 | Enter your SS-4 federal employer's identification number |
| Box 2 | Leave blank |
| Box 3 | Enter number of 1099-Divs you are enclosing |
| Box 4 | 0 unless you withheld income tax (line 4 on each 1099) |
| Box 5 | Add Box 1 for all the 1099-Divs. |
| Check box | 1099-Div 91 | |
|
| How to submit | |
- Mail copy a of 1099-Div to the IRS with transmittal form 1096
- Mail or deliver copy B to the recipient (the person you paid)
- Keep copy C for your records.
The IRS will automatically send your 1099-Div information to the state tax authority. |
|
| Magnetic scanners |
| The IRS wants to speed its processing by using magnetic scanners. Thus, it
has the following rules ($50 fine for ignoring them!)
- Type forms - regular type style
- Use original forms - no copies
- Submit entire 8 x 11 page - don't cut it up
- Don't staple
- Don't use dollar signs, commas or other symbols, except you should use decimal
points to show dollars and cents.
|
|
| Questions? | |
For forms (800) 829-3676. You cannot obtain original forms from the Internet. For information, call (800) 829-4933 or
read Publication 937 Business Reporting.
|
