topic Re: Erroneous 1099-DIV in Get your taxes done using TurboTax

Erroneous 1099-DIV

Taxed2D — Wed, 11 Feb 2026 06:31:53 GMT

I rolled over part of my 401K to a rollover IRA in early 2023. The rollover of company stocks for that rollover went through a custodian (Computershare) before being deposited into my Rollover IRA account. The company paid dividends in that short window while the shares were with Computershare. Computershare in turn mailed me a dividend check for these which I promptly deposited into my Rollover IRA. Computershare issued me a 1099-DIV for those even though I had notified them and provided documentation that they were rolled over into an IRA. They acknowledge that the rollover should not be taxed but are unwilling to correct the 1099-DIV and referred me to the Rollover IRA financial institution who in turn referred me back to them!! How do I correctly report this in Turbotax so it is treated as the non-taxable rollover it was? Thanks

Re: Erroneous 1099-DIV

fanfare — Fri, 08 Mar 2024 03:35:39 GMT

Did the new custodian know you were doing a 60-day rollover deposit?

The first custodian should give you a 1099-R not a 1099-DIV

@Taxed2D

Re: Erroneous 1099-DIV

Taxed2D — Fri, 08 Mar 2024 07:00:47 GMT

They did know that I was doing a 60 day deposit into a rollover IRA but insist that either the financial institution for my rollover IRA correct this or I figure out a form to fill out to notify the IRS!

Re: Erroneous 1099-DIV

fanfare — Fri, 08 Mar 2024 07:35:56 GMT

If you report the 1099-DIV as "nominee distribution" i.e. belonging to someone else,

TurboTax should put a negative amount on Schedule B to cancel the amount.

@Taxed2D

Re: Erroneous 1099-DIV

Taxed2D — Tue, 12 Mar 2024 06:58:17 GMT

Thank you. I had tried that but was not sure if it was allowed. I called the custodian and financial institution again and each referred me to the other again so the option you mention is likely my only path forward.

Re: Erroneous 1099-DIV

warangal751 — Thu, 10 Apr 2025 01:26:30 GMT

I have the exact same issue this tax year 2024. Can you tell me what was the resolution?

Re: Erroneous 1099-DIV

ThomasM125 — Tue, 15 Apr 2025 22:58:44 GMT

You should enter the 1099-DIV form and on the screen that says Do these uncommon situations apply? Choose the I need to adjust these dividends option.

On the next screen you can choose the Other adjustment, including restricted stock dividends reported on Form W-2 option and then on the next screen you can enter the dividend amount as an adjustment to cancel out the dividend income.

Re: Erroneous 1099-DIV

syoung123 — Fri, 27 Jun 2025 19:47:49 GMT

Hello, does anyone have any latest updates on this? I have the same issue for 2025. I roll-overed my 401K to Empower brokerage traditional IRA in early May 2025. A portion of the 401K was converted to common stocks of a company, and Empower used Computershare as "transfer agent" to convert the shares and held in a Computershare IRA account. Empower told me, once the account at Computershare (as IRA) has been setup, I would request Empower to transfer the stock shares from the Computershare account to the Empower traditional IRA account. However, in the mean time, there was a dividend distribution, and Computershare sent me a paper dividend check with the payee name - Empower as the custodian for the benefit of me (my SSN would be on the 1099Div even though the account name says Empower is the custodian). I called Computershare several times, one time a rep told me the account needed to be setup as "tax-exempt" but I couldn't request making the change because I am not the owner of the account. I called Computershare back with an Empower representative, and Computershare told me that they couldn't do tax-exempt. Computershare standard process is to issue a 1099Div, it would show the dividend as taxable dividend, when the 1099Div is issued, I would give the 1099Div to Empower, and Empower would give me some kind of proof that the check was deposited into the Empower IRA account, and therefore the dividend would not be taxable (it would be tax deferred until I start taking money out of my Empower IRA account).

This process described by Computershare doesn't make sense to me. The 1099Div issued by Computershare will be reported to IRS to show the dividend distribution as taxable dividend income. How would Empower provide evidence to IRS that the dividend check was deposited to my traditional IRA and therefore tax-deferred? It looks that I can’t request any “tax-exempt” changes to Computershare. I would think this scenario happens regularly and Computershare should know what needs to be done. But I can’t understand how this process would be reported to IRS showing the 1099Div amount is non-taxable for 2025 (or tax-deferred).