Fidelity 1099

wiltse@optonline.net on

I am posting this problem here in case it is of interest to others, especially those who use Fidelity.

When comparing the Fidelity 1099 to Bivio's computation of dividends and qualified dividends I noticed Bivio classified one of our dividends as non-qualified. When I looked I saw we did not hold the stock for 61 days so Bivio was correct that it was non-qualified. Fidelity, however, classified it as qualified. I called Fidelity and they said they would look into it and issue a corrected 1099.

As a tax preparer, i am now concerned that Fidelity may have made similar mistakes for other people. How many other brokers are making this mistake.

Bottom line, if Bivio and your broker do not match in the dividend category, you need to determine which is correct and possibly get a corrected 1099.

Linda

Pointe Players

Sent from my LG V20, an AT&T 4G LTE smartphone

rice.j1969 on

Too bad that you can not record it as a qualified dividend as per the 1099 and the IRS goes after the Broker for the difference in the missed taxes that should have been paid. That would make the brokers more careful in their reporting. Meanwhile, the investor has to wait for a corrected 1099 and all the club members have to wait longer to do their taxes.

John

ABODI Investment Club

On Monday, February 27, 2017 11:36 AM, "wiltse@optonline.net" <wiltse@optonline.net> wrote:

I am posting this problem here in case it is of interest to others, especially those who use Fidelity.

When comparing the Fidelity 1099 to Bivio's computation of dividends and qualified dividends I noticed Bivio classified one of our dividends as non-qualified. When I looked I saw we did not hold the stock for 61 days so Bivio was correct that it was non-qualified. Fidelity, however, classified it as qualified. I called Fidelity and they said they would look into it and issue a corrected 1099.

As a tax preparer, i am now concerned that Fidelity may have made similar mistakes for other people. How many other brokers are making this mistake.

Bottom line, if Bivio and your broker do not match in the dividend category, you need to determine which is correct and possibly get a corrected 1099.

Linda

Pointe Players

Sent from my LG V20, an AT&T 4G LTE smartphone

Laurie Frederiksen on

Brokers are not required to run the holding period check to make a final determination if a dividend can be considered qualified. You, however, are. That is why we run it for you.

If a difference you see between our forms and theirs is because of this and what is shown in bivio is correct, that is fine. I wouldn't worry about going through the exercise of getting a corrected 1099 issued by the broker. You will be reporting a higher taxable amount (correctly) than they do. I doubt if the IRS will have a big problem with that.

Laurie Frederiksen
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On Mon, Feb 27, 2017 at 3:17 PM, <rice.j1969@att.net> wrote:

Too bad that you can not record it as a qualified dividend as per the 1099 and the IRS goes after the Broker for the difference in the missed taxes that should have been paid. That would make the brokers more careful in their reporting. Meanwhile, the investor has to wait for a corrected 1099 and all the club members have to wait longer to do their taxes.

John
ABODI Investment Club

On Monday, February 27, 2017 11:36 AM, "wiltse@optonline.net" <wiltse@optonline.net> wrote:

I am posting this problem here in case it is of interest to others, especially those who use Fidelity.
When comparing the Fidelity 1099 to Bivio's computation of dividends and qualified dividends I noticed Bivio classified one of our dividends as non-qualified. When I looked I saw we did not hold the stock for 61 days so Bivio was correct that it was non-qualified. Fidelity, however, classified it as qualified. I called Fidelity and they said they would look into it and issue a corrected 1099.
As a tax preparer, i am now concerned that Fidelity may have made similar mistakes for other people. How many other brokers are making this mistake.
Bottom line, if Bivio and your broker do not match in the dividend category, you need to determine which is correct and possibly get a corrected 1099.
Linda
Pointe Players

Sent from my LG V20, an AT&T 4G LTE smartphone