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

The issuer knows. Your form 1099-DIV shows all dividends in box 1a.

• The qualified dividends are marked in 1b. The issuer knows if the # days test was met. 
• The same for box 5, it notes only qualified sec 199a dividend income. No work for you to do.

 

See Instructions for 1099-DIV for full details on each box and line.

Okay great, thanks for the peace of mind and the response!

Hi Amy,

Thank you for your reply - very helpful.  

If the brokerage house is required to enter in box 1b and 5, only dividends from securities that meet the holding period requirement (qualified and REIT dividends, respectively), why does TurboTax ask the question in the Step-by-Step Mode if:

Some qualified dividends or Section 199A dividends are from securities that did not meet the holding period?

 

It seems to me that TurboTax is just making it more confusing or am I missing something?

TT is asking this question since, based on IRS instructions relating to RICs and REITs, If any part of the total ordinary dividends reported in box 1a is qualified dividends, report the qualified dividends in box 1b. 

Qualified REIT dividends.

Certain taxpayers are entitled to a deduction under section 199A computed by reference to several types of income, including qualified REIT dividends. A qualified REIT dividend is generally a dividend from a REIT received during the tax year that is not a capital gain dividend or a qualified dividend.

 

See Detailed Instructions from IRS below. Scroll to the Section on RICs and REITs.

 

Instructions for Form 1099-DIV

 

@LisaRose L 

 

I'm still confused since the question in TT

 

Why does TurboTax ask the question in the Step-by-Step Mode if:

Some qualified dividends or Section 199A dividends are from securities that did not meet the holding period?

 

pertains to boxes 1b and 5.  It's allowing me to adjust the amount in boxes 1b and 5.  From reading the IRS instructions for the 1099-DIV box 1b and 5, it seems that only those dividends from securities that meet the holding period are allowed in these boxes.  So why the question?

I would just ignore that question and hit none of the apply to me. As long as you have the information from the brokerage statement which clearly indicate the amount that should be reported as qualified dividends on that line 1b and the amount of section 199a qualified reit dividend on line 5, then you are good to go. For further discussion on qualified dividends, see HERE . Also, hit the "learn more" for more details. See here

 

Enjoy.