K1 and 1099-DIV

[mkrachenfels]

I received quarterly preferred distributions in 2018 from Teekay Offshore Partners (Bermuda Based Company).  The company issues a K1.   My broker is reporting the distributions as Ordinary Qualified Dividends on the 1099-DIV.  How do I report this income on my return in Turbotax?  Do I fill out K1 only?

[DawnC0]

Take a close look at the Form 1099-DIV to see what tax identifying number is used for that form. 

If it is reported under your personal social security number, then it is for your personal account and should be included on your personal return.  Have the broker issue you a corrected form if it is not accurate.  

If it is reported under the Federal ID number for Teekay, then it is income for the partnership and should be included on the business return and subsequently, your portion on your K-1.  

The dividend income should only be reported on your personal tax return one time.  If it has already been included by entering your K-1, then do not enter it again under the dividend income section of your return.  

[mkrachenfels]

The 1099-DIV is reported under my social security number.  I reached out to my broker about changing the reporting and received this response:  Foreign MLP distributions will be classified as an ordinary dividend and not MLP distributions on your tax forms at Interactive Brokers.   Do I ignore the K-1 and just report the 1099-DIV number?

[DawnC0]

I don't think so, but let me see if I can get @Rick19744 to comment here.  😉

[Rick19744]

Master Limited Partnership reporting is complicated if done correctly, and even more complicated when all parties are not on the same page.
I will provide some comments:
1) Thankfully this will be the last year you have to deal with this as I believe Teekay has elected to be taxed as a C corporation effective January 1, 2019.
2) You should not be double reporting the same information.  Make sure you are understanding exactly what is being reported on the K-1 vs the broker statements.
3) In general, MLP distributions are not dividends.  Take a look at the broker statement.  Many broker statements reflect amounts, however, if you read the statement it indicates (in some sections) that this information is not reported to the IRS.  So some amounts are reported to the IRS and other amounts are not reported.  So as noted in comment 2, double check your broker statement to make sure you understand which amounts are actually being reported to the IRS.

[rogge1722]

You mention you are receiving quarterly preferred distributions. Do you own Teekay preferred stock in addition to MLP units?

[Rick19744]

In doing some additional research here, I believe you need to call who ever got you involved in this investments to ask for some clarification or investor relations (see below).
I noted previously that it appears that the partnership elected to be a C corporation effective 1/1/2019.  Not sure where I got that as it appears that the partnership had previously elected to be taxed as a C corporation.
As a result, I am not sure why you are receiving a K-1.  See the attached link for some discussion which confirms the reporting of dividends on a form 1099 and NOT on a Schedule K-1.

<a rel="nofollow" target="_blank" href="https://www.teekay.com/investors/teekay-offshore-partners-l-p/tax-information/">https://www.teekay.c...>
Here is a link to some investor contact numbers which I believe should be able to address your questions:

<a rel="nofollow" target="_blank" href="https://www.teekay.com/investors/teekay-offshore-partners-l-p/investor-contacts/">https://www.teekay...>

[mkrachenfels]

I own the preferreds B.  I received quarterly dividends in my brokerage account.  My 1099-DIV lists the dividends as qualified.  I also received a K-1.  One other difference is the K-1 is on an accrual basis - my 1099-DIV is on a cash basis.

[cabernetjack]

Can you please share if this was resolved and how it was accomplished?  I was reviewing my 2018/2019 1099-DIV and I have the same problem.  I was holding the TGP Series B preferred at Interactive Brokers and it was reported on their 1099-DIV and I also received an associated K-1 for the same distribution.  It also appears that the 2018 K-1 included the payment with record date 12/27/18.  However since the distribution occurred on 1/15/19, Interactive Brokers is again recording it on the 2019 1099-DIV resulting in another double counting for 2019.

Any indication on how this was/is fixed would be appreciated?

[Sara88]

This is happening to a client of mine...Info is being double counted from the 1099-DIV onto the 1065 K-1 (a foreign partnership).  And yes, the SSN's match for both documents.  Did anybody find out the proper way to do this?  Do I just ignore the K-1 or will that cause issues for my client?  Is there a way to "link" or "match" them in the system so that it's not double counted but still reported?

[JohnLovesUSA]

My 1099-DIV form from my brokerage company reports other company dividends I have received as well.

Should I subtract the dividends when filling up my 1099-DIV for the dividends that I also have received the K-1 (Form 1065) as these are definitely duplicated???

Thank you.

[GeorgeM777]

As noted in previous posts, you should only report your dividend income one time on your tax return.   You are correct in that if you have added the dividend income in two different sections in TurboTax, then you will need to delete the one that is not relevant to your tax return.

Where and how you should report these dividends is predicated on how the payor views your status.  For example, you mentioned that you received a Schedule K-1.  Therefore, does the payor of the dividend consider you a limited partner?  Review Part II of your Schedule K-1 as there you will find information about your status as a partner, among other things, i.e., whether you are a limited partner, general partner, domestic partner, etc.  If you are a partner, then report the dividend income under the category Business Investment and Estate/Trust Income  (TurboTax CD/download) or S-corps, Partnerships, and Trusts (TurboTax online).  

You probably are a limited partner and the dividend information entered on your 1099-DIV that duplicates the dividend information on your Schedule K-1, is just that, a duplicate and can be ignored.  With regard to the other dividends reported on your 1099-DIV, it appears you have already reported those so there is no need to make any further adjustments regarding those dividends. 

@JohnLovesUSA