How do I figure out if Some qualified dividends or section 199A dividends are from securities that didn't meet the required holding period?

[sennis1]

I received some dividends that qualify as section 199A. Turbotax is asking if any of them do not meet the required holding period. I would like to know how I would figure that out. Thank You.

[ReneeM7122]

To answer this question, refer to IRS Tax Cuts and Jobs Act, Provision 11011 Section 199A - Qualified Business Income Deduction FAQs

Ineligible dividends include those for which the taxpayer did not meet holding period requirements.  The QBID may not be taken for any dividend reported in box 5 for dividends received on a share of ...stock that is held for 45 days or less during the 91-day period beginning on the date that is 45 days before the date on which such share became ex-dividend with respect to the dividend. When counting the number of days that the stock is held, include the day the stock is disposed of but not the day the stock is acquired. Also, don't count days during which the risk of loss was diminished. Specifically, don't count any day during which any of the following conditions are met:

1. The taxpayer had an option to sell, was under a contractual obligation to sell, or entered into (and not closed) a short sale of substantially identical stock or securities.
    
2. The taxpayer was a grantor (writer) of an option to buy substantially identical stock or securities.
    
3. The taxpayer's risk of loss was diminished by holding one or more other positions in substantially similar or related property.

In addition, the deduction may not be taken for any dividend on shares of the stock reported in box 5 to the extent the taxpayer is under an obligation (whether pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related property.

[pyropinup]

I have the OP's same question about both Section 199A dividends and total qualified dividends that met the 60/90 day holding period. The response doesn't seem to answer this question of how does one determine with their 1099-DIV which dividends met the holding period requirements? Can you have a negative number for this answer?

[JillS56]

The 1099-DIV should indicate whether or not any of the dividends qualify as 1099A dividends.  It would show in Box 5 of the 1099-DIV.

[TaxBizLady]

What are Section 199A dividends?
These are dividends from REIT (real estate investment trusts) or PTP (publicly traded partnerships) that qualify for special 20% deduction. They don't have a holding period like qualified dividends. But they are reported as you would other dividends.

The brokerage will identify non-qualified dividends that don't meet the holding period. They will be separated from other dividends.

To confirm the holding period, check your transaction history.  Look for the date the stock first started trading w/o dividends.  Count back 60 days before the trading day ("ex-dividend date") and count forward 60 days after. You want a 121-day window (don't count the sale day) of ownership. If you bought and sold within this window they do not qualify for the special treatment or are "qualified".

What other reason could there be for a dividend not to be qualified?  If you sold it too soon or it was a dividend from a foreign company not on US exchange, a money market account interest, tax-exempt organization, a tax-advantaged account like a 401K, IRA, HSA, it would not qualify for special treatment since there are other tax laws applicable with other benefits.