If you are a US citizen or resident alien, you will need to include this UK dividend (In USD) on your US income tax return. (Nonresident aliens filing a Form 1040NR are only required to report US source income and therefore would not report foreign source dividend income on a 1040NR.)
You
will report the cash portion of your dividend in USD as though you received a
1099-DIV for this transaction.
The Internal Revenue Service has no official
exchange rate. In general, use the exchange rate prevailing (i.e., the spot
rate) when you received the income. Please refer to the following IRS links for
more information about Foreign
Currency and Currency Exchange Rates and Yearly
Average Currency Exchange Rates
To enter this dividend income in TurboTax
Online (for TurboTax
Online sign-in, click Here , then select "Take Me to My Return") or Desktop, please follow these steps:
- Once
you are in your tax return, click on the “Federal Taxes” tab ("Personal"
tab in TurboTax Home & Business)
- Next click on “Wages &
Income”
("Personal Income" in TurboTax Home & Business)
- Next click on “I’ll choose
what I work on” (jump to full list or see more income)
- Scroll down the screen until
to come to the section “Interest and Dividends”
- Choose “ Dividends
on 1099-DIV” and
select “start’
- Select "I'll type it in
myself"
- Enter the name of the
brokerage firm/foreign corporation and the amount (in USD) in box 1a (Usually foreign dividends are not considered qualified dividends).
- Check the box "My form
has info in more than just box 1 (this is uncommon)".
- Enter any Foreign taxes paid in Box 6.
