1099-DIV Foreign Dividends?

[Tracer-x]

A company recently transitioned people to "brokerage" from 'regular'.  I used to import with ease but now I find I have to manually enter some stuff.  I looked for tax papers on the site, and got them all.  The 1099-DIV lists all dividends and Foreign Tax paid.   But TT is asking what part of the listed dividends are foreign.  I have no idea, and they are not broken out.  And it isn't "obvious" .  I can't find the info anywhere in my tax info.  Any ideas?

THank you

[pk · Accepted solution]

@Tracer-x , if the brokerage has not provide you with the back-up documentation ( like a Mutual fund provides  percentage of  investment in foreign stocks  ( and countries ) and thus you can compute  the share of the dividend that is foreign source  , by country, you have no choice  but calling your broker to give you the details.

Sometimes  they may tell you "various" but still a percentage  of "foreign-various  countries ).

Is there more I can do for you ?

[AmyC · Accepted solution]

You must have foreign tax paid on your tax form. There should be a detail page which lists the foreign dividends -with  a percentage amount. It could be just one line in the stack of forms or it may have a list of countries. 

If this is a regulated investment company, you can elect RIC on the foreign tax credit. Otherwise, you need the countries to claim the foreign tax credit.

For Example: Brazil 1.3%

This lets you know that 1.3% of you investment is in Brazil. 

Or, your paperwork may just say foreign because the company is investing only in countries allowed for the foreign credit

[pk]

@Tracer-x  while I agree with my colleague @AmyC  for her detailed response, note that dividends  generally reported on 1099-Div,  when , and if .,  below the  safe harbor amount ( US$300 per filer  ) may not need much detail.  If you have to use form 1116  ( because  the foreign tax amount  is above the safe harbor amount ) then yes you will need to provide the details as  suggested by  @AmyC .

Note the answers her are general because we  have insufficient details.   Please consider  getting more details from your broker.

[Tracer-x]

Thank you for your info!

I did finally find a place where the dividend percentages were identified.  I thought TurboTax would just calculate this for me, as all the numbers are available, and I imported from the firm (ex: Fidelity or Vanguard).    

I don’t think I’ve ever had to enter this, and it didn’t seem to affect my taxes , so I was perplexed as to why I had to do all this math all of a sudden. 

cheers!

[fbmcardl2]

My 1099s show foreign tax paid. So I have that. But then TT asks about the foreign dividends associated with that tax and it only gives two choices, individual country or Regulated Investment Company. My 1099 has both categories of foreign tax paid. But TT will only allow that one mutually exclusive choice of whether it's an individual country or an RIC. You can't select both. What do I do in this case? Using TT Premier online with LiveAssist but the rep who tried to help me yesterday knew even less than I do so it's not been resolved. Thanks.

[DaveF1006]

 Turbo Tax only allows one choice per entry. In the list of countries listed, is various listed as an option.  If so, select various.

[fbmcardl2]

Yes, I thought about that too but unfortunately "various" is not an option on TT country list, even though Various is what the broker puts on the 1099-DIV to handle that. TT really needs to fix this. It's not uncommon for 1099-DIVS to show foreign tax paid. I guess I could bundle them all under RIC but it seems odd to have to do that.

[DaveF1006]

Yes, in this case, it is best to put the entire amount in RIC as this would not be an issue with the IRS. 

[pk]

@fbmcardl2 , agreeing with my colleague @DaveF1006 , in that  (a) there  needs to be only one entry per 1099-DIV ( in TurboTax ) and  (b)  foreign source dividend when multiple countries are involved  one needs to use  " various" or "RIC" -- on this I sort of remember an IRS  comment that  RIC is the preferred  way to denote this.  It stands to reason that Mutual Funds  ,for example, itself is a RIC under US laws but the  invested in entities  may not qualify as RIC for US purposes.

Does this make sense  or am I muddying the water here ?

Is there one of us can do  for you ?

[fbmcardl2]

Well, thanks to you both! I talked to a nice Live Assist person today who told me that using TT Desktop Home and Business allows the Various option to be selected but not TT online. So I'm going with RIC since I'm using online. But I think next year I may download TT Home and Business and then (something new this year) TT will ask if you want to use Live Assist and if so one pays an additional $60 for that add on to the desktop version.

[ndhoward1]

Thanks DaveF1006. I agree with fbmcardl2 that it seems odd we have to use "RIC" or "various". It would have been easy for TT to tell us that instead of giving two mutually exclusive choices with no further guidance on how to enter both.  I have statements from Fidelity and Schwab and they both show clearly how much dividends are from each of several individual countries as well as RICs. I'm using TT deluxe home version on my PC.  Per your suggestion I'll go with "various". Thanks!