First off, thanks for the quick response -- much appreciated. You've answered my questions but I'll provide further explanation for anyone who might be struggling with the same issues:
My mother received a form 1099-DIV from her brokerage with entries for 5 different mutual funds with varying types of income. I have allocated amounts for each "box" between my mother's return and the recipient's return (her trust). Do I need to file a corresponding 1099-DIV for each mutual fund, or do I consolidate all amounts into a single 1099-DIV?
- I'm not sure what you're asking. If some of the 1099-DIVs are for the trust, they should be posted to the trust. Your mother's 1099-DIV should be posted to her personal return. I would recommend posting the individual 1099-DID's. This will provide you with a better audit trail.
She received a single document from her broker with an individual line item for 5 different mutual funds. They all had a value in Box 1a, two of them had a value in Box 1b, another had a value in Box 2a, one had a value in Box 3 and two of them had values in Box 5. For all of the mutual funds, some portion of the dividends had to be allocated to my mother's return (her SSN), and the balance allocated as Nominee Distributions to the trust's EIN. This occurs, of course, because there is a period between the date of death and the date when the trust is moved over to the new EIN. The next step is to file the paperwork notifying the IRS and the recipient (the trust) of the Nominee Distribution -- a pretty straightforward exercise but not trivial given TT's method of prorating the amounts (another issue altogether). Since Schedule B only requires a single number as the adjustment (the sum of all box 1a Nominee Distributions), I thought maybe the IRS only wants to see a single 1099-DIV filed with that amount. However, that means the amounts in the other Boxes would also be summed into single values (all Box 1b nominee amounts totaled, all Box 2a nominee amounts totaled, etc.). I just don't know whether the IRS cares about that. In other words, do they care exactly how much 199A dividend was derived from mutual fund X and how much from mutual fund Y. Anyway, I like your recommendation as long as it's not annoying the folks reviewing the returns.
If I must file a 1099-DIV for each mutual fund, is some notation necessary to indicate the relationship between the nominee 1099-DIV and the original 1099-DIV?
- I'm not sure what you're referring to the nominee's 1099-DIV. No additional notes are required on the individual 1099s. It is covered by the indication that it is a Final Return.
By "nominee's 1099-DIV" I mean the 1099-DIV that I have to file to formally remove the income from my mother's SSN and assign it to the trust EIN. The "original 1099-DIV" refers to the 1099-DIV from the broker to my mother. I just wanted to know whether it was common practice to connect those dots for the IRS. For example, is it typical to enter some reference on the 1099-DIV filing (or maybe on the 1041) to indicate that it represents a nominee distribution related to the 1099-DIV received from mutual fund X, or Y, or Z, etc.. I'm not sure how else they could discern that (or if they care).
Thanks again.
