The information shown on the 2007 Form 1099-DIV for investors in the Duke Energy Corporation DRIP plan has changed from prior years.
The amounts shown in boxes 1a and 1b represent only the value of the actual reinvested dividends. There is an entry in an unnumbered box below box 4 ("earned income") for "brokerage fees incurred by the Plan on your behalf." However, that amount is not included in the totals showing dividends/qualifying dividends. NOTE: The only "numbered" boxes on the Duke Energy 2007 Form 1099-DIV are 1a, 1b, 3, and 4. The "earned income" is in a box of its own.
The tax laws have not changed, i.e. taxable income and cost basis of the DRIP shares both include the brokerage fees, and a review of pages 20/21 of their prospectus ( http://www.duke-energy.com/pdfs/Prospectus.pdf ) fully supports that long-standing concept.
So, for accuracy purposes, where does one include the "earned income" figure on the Form 1099-DIV so as not to create any income reporting problems? SURELY this amount does not travel to line 21 of Form 1040!
As a side question, why exactly would the company, starting only in 2007, present the same type of DRIP information differently on its Form 1099-DIV? Is this a common practice now with other DRIP programs???
Thanks!
FE
The amounts shown in boxes 1a and 1b represent only the value of the actual reinvested dividends. There is an entry in an unnumbered box below box 4 ("earned income") for "brokerage fees incurred by the Plan on your behalf." However, that amount is not included in the totals showing dividends/qualifying dividends. NOTE: The only "numbered" boxes on the Duke Energy 2007 Form 1099-DIV are 1a, 1b, 3, and 4. The "earned income" is in a box of its own.
The tax laws have not changed, i.e. taxable income and cost basis of the DRIP shares both include the brokerage fees, and a review of pages 20/21 of their prospectus ( http://www.duke-energy.com/pdfs/Prospectus.pdf ) fully supports that long-standing concept.
So, for accuracy purposes, where does one include the "earned income" figure on the Form 1099-DIV so as not to create any income reporting problems? SURELY this amount does not travel to line 21 of Form 1040!
As a side question, why exactly would the company, starting only in 2007, present the same type of DRIP information differently on its Form 1099-DIV? Is this a common practice now with other DRIP programs???
Thanks!
FE