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Level 2
posted Mar 30, 2022 12:45:36 PM

Can I file a 1099-DIV as nominee for mutual fund capital gain distributions?

I have a joint account with my ex-husband and we are filing separately.  My SSN is on the account as the liable tax payer.  We have Dividends (in box 1a and 1b) as well as Capital Gain Distributions (in box 2a) on our 1099-DIV form from the mutual fund account.     

- Can I file a 1099-DIV for his portion of capital gain distributions as nominee recipient? I read somewhere that the capital gain distributions cannot be allocated via 1099-DIV.  If that is true, how am I going to inform IRS of his portion? 

- If, instead of filing a 1099-DIV, I show all the income as mine in my tax return, would that create a problem with the IRS considering we will split the account in 2022?

Thank you.

   

  

0 1 223
1 Replies
Expert Alumni
Mar 30, 2022 1:12:52 PM

Yes, you can designate yourself as the nominee.  The IRS describes the nominee process as:

 

  • Nominees.
  • If you received a Form 1099-DIV that includes ordinary dividends you received as a nominee (that is, in your name, but the ordinary dividends actually belong to someone else), report the total on line 5. Do this even if you later distributed some or all of this income to others. Under your last entry on line 5, put a subtotal of all ordinary dividends listed on line 5. Below this subtotal, enter "Nominee Distribution" and show the total ordinary dividends you received as a nominee. Subtract this amount from the subtotal and enter the result on line 6.

To accomplish this in TurboTax online, follow these steps:

 

  1. Go to Income & Expenses
  2. Scroll down to Interest and Dividends
  3. Select Dividends on 1099-DIV
  4. Enter your 1099-DIV information, but select that the 1099-DIV belongs to the both of you.
  5. On the page Tell us if any of these uncommon situations apply to you, select I need to adjust these dividends...
  6. Select I need to adjust these dividends
  7. Continue through the section and enter the requested information.

@yesimk