Adjustments to 1099-DIV due to divorce

[RobMer]

I was divorced in 2021 and received a 1099-DIV from my brokerage firm for an account (now empty) owned jointly with my wife. I am confused as to how to adjust the joint 1099-DIV so it reflects income that was split 50-50. Can I simply change the values imported into Turbo Tax by 50 percent? Besides ordinary and qualified dividends, there are values reported for Nondividend Distributions, Section 199A Dividends and Foreign Tax Paid. Shouldn't the amounts I enter on my return and the amounts my former spouse enter on hers add up to what was on the original 1099-DIV in each category?

[DianeW777]

Yes.  You can split the information in half for each of your returns in all boxes.  The next step should be to nominee the distributions.

If the 1099-DIV shows your social security number you can nominee the other half to your other spouse. Follow the steps below.

After entering the full amount on your return, follow these steps:

1. After you click Continue when you have finished entering the information from your Form 1099-DIV, the next screen is titled “Tell us if any of these uncommon situation apply to you” 
2. Select “I need to adjust these dividends”  > select again I need to adjust these dividends by checking the box
3. Continue
4. Then you will see a screen titled “Tell us about your dividend adjustment”
5. Enter the amount as a positive number and the reason for the adjustment.  This will make the proper entry on your Schedule B.
6. Review the images below

[RobMer]

Thank you, DianeW777, that's a big help.

I am still confused, however. After I have entered 50% adjustments into my 1099-DIV in Turbo Tax, what adjustment do I enter to nominee the dividend income? Step 5 on the instructions say to, "Enter the amount as a positive number..." Since I have already made the adjustment on the 1099-DIV, can I enter a zero here?

And then, do I need to obtain form 1096 from the IRS and file that with a new 1099-DIV to give to my former spouse? Or can I avoid that since at the time the income was generated the other person was my spouse? I suppose I'll need to include a statement to explain all this with my return?

[RobertB4444 · Accepted solution]

@RobMer  You are going to nominee these dividends here - where @DianeW777 showed you.  Do not change the amounts on your 1099-DIV.  Enter the full amount there.  Then follow the steps above.  The system will change the amounts on your return by your entry here.

Your former spouse will enter the 50% amounts on their return and you'll go from there.  

You do not need to attach an explanation.  If the IRS wants more information they will send a letter requesting it.  But as long as the total amount that was received is split correctly between the two returns then there is no more that needs to be done.