Several conversations this week involved discussions of the Tax Forms that we are expecting to receive…
Thanks for a Great Timely Post Subject!
The key to tax forms is focusing on the last letter or letters… they are basically all 1099 – but the last letter or letters drives the type of form and reporting!
Tax Form ABC
Here are the forms coming our way, with a quick explanation…
R- Stands for Retirement (fun word association)
1099-R’s are rarely corrected, as the reporting is super easy … whatever was taken out of the account is reported for tax purposes!
Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, etc.
|Distributions from qualified retirement plans—for example, individual 401(k), profit-sharing, or money-purchase plan—or any IRAs or IRA recharacterizations, conversions, or removals of excess||January 17, 2020
By close of business
Next up the consolidated form…
Think of this one as the Whole Enchilada….(bunches of 1099 s on this one form!)
These are the main forms within the Whole Enchilada….
Form 1099-B, Form-DIV, Form 1099-INT, Form 1099-MISC (Dividends, Interest, Miscellaneous other stuff)
This form may have multiple corrections….
|Consolidated Form 1099||All reportable income and transactions for the year
If a client received at least $10 in either dividends or interest during the tax year or had an equity sale in a taxable account, they will receive an Internal Revenue Service (IRS) Form 1099
If applicable to the account, Consolidated Form 1099s may include: Form 1099-B, Form-DIV, Form 1099-INT, Form 1099-MISC, and Form 1099-OID
|February 12, 2020
By close of business
May be available earlier, depending on the activity and holdings in your client’s account
Many ask, why the corrections…
“Why can they not get it correct the first time?”
Let’s exaggerate to make our point… hang with me; If you have an account with 50 investment holdings, there are 50 chances to have a correction as EACH ONE of these investments will have their own tax reporting…. said another way, if any one of these 50 holdings has an issue/correction, there will be a Whole Enchilada corrected form…
Hmmmm… now that we think about it….surprised we do not have more corrected forms!
During the fall, Donald “The Brain” went to great extensive efforts to get all basis information correct… that does not mean that there will be no Corrected forms, but we expect much fewer, if any!
Tennis Player is six hours away with the better half … still in Texas… fulfilling the goal once again…maybe by accident… but that is ok!
Have a Great “ABC Tax form” Day!
John A. Kvale CFA, CFP
Yes sir in the vault
Are the year end performance statements complete?
Mike Roudi MCR Partners (214) 810-1338