1099-Div Box 9

Forum|Forum|6 years ago
March 7, 2020
1 reply
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I closed my business this year and received a 1099-DIV with 10000 in box 3 and 25075.34 in box 9. TurboTax tells me to handle it later, but iI don't see what to do.

Best answer by KarenM90

You don't need to worry about Box 3, that is really just informational.

For Box 9: Liquidating distributions are distributions you receive during a partial or complete liquidation of a corporation.

These distributions are considered a return of capital.

Liquidating distributions are not taxable to you until you have recovered the basis of your stock.

After the basis of your stock has been reduced to zero, you must report the liquidating distribution as a capital gain.

Whether you report the gain as a long-term or short-term capital gain depends on how long you have held the stock.

If the liquidating distribution shown in Box 8 or 9 is a complete liquidation, then report the amount in Box 8 or 9 on the stock sale screen as a stock sale. You will report it in the Investment Income section under Stocks, Mutual Funds, Bonds and Other.

KarenM90Answer

Level 11

You don't need to worry about Box 3, that is really just informational.

For Box 9: Liquidating distributions are distributions you receive during a partial or complete liquidation of a corporation.

These distributions are considered a return of capital.

Liquidating distributions are not taxable to you until you have recovered the basis of your stock.

After the basis of your stock has been reduced to zero, you must report the liquidating distribution as a capital gain.

Whether you report the gain as a long-term or short-term capital gain depends on how long you have held the stock.

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Tauepsilon1920

Level 3

If the liquidation is not complete yet, besides entering the 1099-Div Box 9 amount on the TurboTax 1099-DIV, where else would I go to capture so that amount is not taxed as gain if I haven’t received all my basis back? Thank you!