STCG in Drake Dividends

[Beersheba]

The Drake Dividends screen has no accommodation to enter short-term capital gains. These are often abundant in mutual funds. I called customer support and could not get an answer other than to "force" the entry onto Schedule D.

Anyone out there deal with this?

Thanks in advance -

[Anarchrist]

There is no box on a 1099-DIV labelled ST Cap Gain. They're included in Ordinary Dividends.

[FEDUKE404]

If you have any STCG, they would be reported on Form 1099-B and **NOT** on Form 1099-DIV. If from a mutual fund or similar, as Anarchrist noted, such is just included in the ordinary dividends total.
I don't see this issue as even possibly being a problem with Drake (or any) tax software.

[Beersheba]

Short-Term Capital Gains is in fact appearing on 1099-DIV statements. In fact, for mutual funds, STCG are quite abundant. Anarchrist implies that if we attempt to enter them separately, we are creating duplicate income for the taxpayer. I'm happy I asked before doubling up on income. Thanks to both of you for responding.

[FEDUKE404]

Short-Term Capital Gains is in fact appearing on 1099-DIV statements. In fact, for mutual funds, STCG are quite abundant. Anarchrist implies that if we attempt to enter them separately, we are creating duplicate income for the taxpayer. I'm happy I asked before doubling up on income. Thanks to both of you for responding.

I have NEVER seen any short-term capital gains listed on a Form 1099-DIV tax document. And I've seen a lot of brokerage tax documents.

But if you are looking at an annual "income summary" for an investment account, it is likely you will see such things as ordinary dividends, qualifying dividends, return of capital, short term capital gains, long term capital gains, Sect 199A income, and more. For some types of investments (REITs for instance), you may see perhaps twenty entries on the tax summary statement (again, it's only an information document!) for four quarterly dividend payments that were paid.

If your Form 1099-DIV does, in fact, show a reprtable number for STCG I would love to know which brokerage firm is generating such. . .

[Beersheba]

Ameriprise Financial, TD Ameritrade, Edward Jones, etc.

Duke, we may have a different perspective - if you've seen many such brokerage summaries I'm sure you've seen these. They often come on a combined 1099-B/1099-INT/1099-DIV statement.

[kathyc2]

Ameriprise Financial, TD Ameritrade, Edward Jones, etc.

Duke, we may have a different perspective - if you've seen many such brokerage summaries I'm sure you've seen these. They often come on a combined 1099-B/1099-INT/1099-DIV statement.

Just because they may come on the same piece of paper does not mean that they are not separate forms.

1099INT transactions go on Part 1 of Sch B
1099DIV dividend transactions go on Part 2 of Sch B Capital gain transactions from line 2a on 1099DIV go on line 13 of Sch D- although software may let you enter them on a worksheet for Sch B
1099B transactions go on a Sch D

[Lion]

Which line on TD Ameritrade's Form 1099-DIV? Mine has lines 1-12 and no STCG line.

[Anarchrist]

Ameriprise Financial, TD Ameritrade, Edward Jones, etc.

Duke, we may have a different perspective - if you've seen many such brokerage summaries I'm sure you've seen these. They often come on a combined 1099-B/1099-INT/1099-DIV statement.

They're listed on the statements that come with the 1099 but those statements are not part of the 1099. Duke mentioned he's seen these on those additional statements. You should be able to reconcile the breakdown to the 1099 and see that the stcg is included in the ordinary dividends but not qualified dividends.

[RWG1950]

All mutual fund dividends are ordinary income unless they are classified as qualified or are designated as either a long term capital gain distribution or tax exempt.
Mutual fund short term distributions are relatively rare. Long term capital gain distributions are the most commonly seen on 1099-divs for stock mutual funds.
At least that's what the guy at the convenience store down the street told me.

[Beersheba]

You not likely to see STCG distributions on the face of 1099B/1099INT/1099DIV summaries from these brokerage houses. If you look in the detail which supports these summaries, you will see abundant STCG in the detail for many mutual funds.

[Rapid Robert]

When all else fails, read the instructions. From 1099-DIV instructions, "Box 1a. Total Ordinary Dividends. Enter dividends, including dividends from money market funds, net short-term capital gains from mutual funds, and other distributions on stock"

"I called customer support and could not get an answer other than to "force" the entry onto Schedule D."

They absolutely do not belong on Schedule D. They are taxed as ordinary income and do not offset capital losses.

[DoubleO]

When all else fails, read the instructions. From 1099-DIV instructions, "Box 1a. Total Ordinary Dividends. Enter dividends, including dividends from money market funds, net short-term capital gains from mutual funds, and other distributions on stock"

"I called customer support and could not get an answer other than to "force" the entry onto Schedule D."

They absolutely do not belong on Schedule D. They are taxed as ordinary income and do not offset capital losses.

I agree they don’t go on D, but CSR at Drake was probably telling poster that if he/she felt these transactions s/be reported separately from the DIV screen, then only option was to put on D. Drake CSRs can help us with the software, but they can’t do the prep for us.

[FEDUKE404]

I can't believe this discussion has gone on for such an extended length. My final thoughts:

• I actually have three separate TD Ameritrade accounts. The Form 1099-DIV has no entrry for short term capital gains. If there are any such from actual stock sales, they are listed in detail on the separate Form 1099-B. Despite my "perspective," I remain firm in my earlier comment that I have never seen a separate line entry on a Form 1099-DIV for STCG.
• Following the Form 1099-INT and Form 1099-DIV and Form 1099-B tax information areas (aka reportable tax documents) on the TD Ameritrade documents , there is a section titled "Detail for Dividends and Distributions." That section shows, per investment asset, all 2021 income, and its character, for each stock owned. The phrase "Short-term capital gain" can be seen for some stocks. That specific income is already included in the amount shown on line 1a of the Form 1099-DIV. This overall reporting format is similar to what I have seen for major brokerage firm statements other than those of TD Ameritrade. But my "perspective" could be limited, I guess?
• If you, for whatever reason, choose to try to report those STCG dividends separately on Schedule D, then you are reporting the same income TWICE. Your client might not be too keen on that approach.
• Side issue -- Re the above, if you choose to report those STCG dividend amounts on Schedule D, exactly WHICH code are you using for the Form 8949 and how do you then reconcile the Schedule D totals with the Form 1099-B reported totals?

OK. . .I'm outta here. Do whatever you feel is appropriate!

[Beersheba]

Early in this discussion. Anarchrist answered this issue, and I have not been duplicating income as a result. Much has been added to the discussion since.