The Money Mustache Community
Learning, Sharing, and Teaching => Taxes => Topic started by: Lan Mandragoran on February 07, 2019, 01:31:22 PM
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Hello,
I did some googling and I'm not sure I follow exactly. I for some reason was under the impression that if I was re-investing my dividends automatically I didn't have to report anything (as long as I wasn't withdrawing anything basically). Is this not correct?
I have 401k, tradIRA's, rothIRA, and taxable.
Any help would be appreciated =].
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Taxable account dividends are taxable income and are reported to the IRS and to you (1099-DIV). You have to put them on Schedule 8249? and Schedule D.
Reinvested or not, withdrawn or not, taxable account dividends still ARE taxable at various applicable rates.(0% to 28%).
Non Taxable account (401k Roth 427 403 TraditionalIRA etc) dividends are not taxable until withdrawal.
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Taxable account dividends are taxable income and are reported to the IRS and to you (1099-DIV). You have to put them on Schedule 8249? and Schedule D.
Reinvested or not, withdrawn or not, taxable account dividends still ARE taxable at various applicable rates.(0% to 28%).
Non Taxable account (401k Roth 427 403 TraditionalIRA etc) dividends are not taxable until withdrawal.
It's Form 8949, but the rest is correct as far as I know.
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Dividends are listed on Schedule B, with the total going to form 1040 line 3b.
The amount of qualified dividends (https://www.bogleheads.org/wiki/Qualified_dividend) goes directly on form 1040 line 3a. This is a subset of the amount on line 3b.
Ordinary (aka non-qualified) dividends (the difference between 3b and 3a) are taxed at ordinary income rates.
Qualified dividends are taxed the same as Long Term Capital Gains (LTCG): 0%, 15%, or 20%. See the Qualified Dividends and Capital Gain Tax Worksheet (https://www.irs.gov/pub/irs-prior/i1040gi--2018.pdf#page=40).
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Dividends are listed on Schedule B, with the total going to form 1040 line 3b.
The amount of qualified dividends (https://www.bogleheads.org/wiki/Qualified_dividend) goes directly on form 1040 line 3a. This is a subset of the amount on line 3b.
Ordinary (aka non-qualified) dividends (the difference between 3b and 3a) are taxed at ordinary income rates.
Qualified dividends are taxed the same as Long Term Capital Gains (LTCG): 0%, 15%, or 20%. See the Qualified Dividends and Capital Gain Tax Worksheet (https://www.irs.gov/pub/irs-prior/i1040gi--2018.pdf#page=40).
MDM is correct, I was thinking capital gains, Oooooops, Sorry.
The 1099-DIV reporting is still OK, as are the issues of reinvested or not.