Luxembourg

Details

  • Service: Tax, Financial Services
  • Industry: Financial Services, Banking
  • Type: Newsletters
  • Date: 1/15/2013

Contact

Gérard Laures

Partner

Tel. +352 22 51 51 - 5549

gerard.laures@kpmg.lu

 

Frank Stoltz

Partner

Tel. +352 22 51 51 - 5520

frank.stoltz@kpmg.lu

Qualified Intermediary News - Issue 2013-03 

January 2013

Review of 2012 Reporting Changes for Forms 1099-B and 1099-DIV

 

Several new requirements for Form 1099-B, Proceeds From Broker and Barter Exchange Transactions, and for Form 1099-DIV, Dividends and Distributions, will apply to calendar year 2012 reporting. A review of these changes is provided below.

 

Form 1099-B (Proceeds From Broker and Barter Exchange Transactions)

 

Purpose of Form

 

Form 1099-B must be issued for each person:

 

  • For whom a broker has sold securities for cash 
  • Who received cash, stock or other property from a corporation that the broker knows or has reason to know has had its stock acquired in an acquisition of control (or had a substantial change in capital structure reportable on Form 8806), or
  • Who exchanged property or services through a barter exchange.

 

Due Date

 

Form 1099-B must be filed with the IRS by February 28, 2013; if filed electronically, the extended due date is April 1, 2013. Recipient statements must be issued by February 15, 2013.

 

Changes for 2012 Reporting

 

The form has been revamped for use in 2012 reporting as follows:

 

  • Box 1a: Date or sale of exchange -no change from 2011 form; report as requested
  • Box 1b: Date of acquisition - no change from 2011 form; report as requested
  • Box 1c: Type of gain or loss - formerly box 8 on 2011 form; report as requested
  • Box 1d: Stock or other symbol – new box; report as requested
  • Box 1e: Quantity sold – new box; report as requested
  • Box 2a: Stocks, bonds, etc. - no change from 2011 form other than box numbered as 2a; report the amount of aggregate cash gross proceeds from the sale or disposition of securities; also, a checkbox must be completed to indicate whether the amount has been reduced by commissions and option premiums
  • Box 2b: If box checked, loss based on amount in 2a is not allowed – New box to be checked if the sale reported in Box 2a is due to an acquisition of control or substantial change in capital to indicate that a loss in not allowed
  • Box 3: Cost or other basis - no change from 2011 form; report the adjusted basis of the security sold, unless it is a noncovered security
  • Box 4: Federal income tax withheld - no change from 2011 form; report backup withholding, if any, withheld from the gross proceeds reported in Box 2a
  • Box 5: Wash sale loss disallowed - no change from 2011 form; report any disallowed loss under Section 1091 only if both the sale and purchase transactions occur in the same account with respect to covered securities with the same CUSIP number.
  • Box 6: Checked if:

    a) Noncovered security

    b) Basis reported to IRS

 

  • Box 7: Bartering - formerly box 14 on 2011 form; report gross amounts received by a member or client of a barter exchange
  • Box 8: Description- formerly box 9 on 2011 form; report a description of the security sold, or services or property provided in a barter exchange
  • Box 9: Profit or (loss) realized in 2012 on closed contracts - formerly box 10 on 2011 form; report as stated
  • Box 10: Unrealized profit or (loss) on open contracts – 12/31/11 - formerly box 11 on 2011 form; report as stated
  • Box 11: Unrealized profit or (loss) on open contracts – 12/31/12 - formerly box 12 on 2011 form; report as stated
  • Box 12: Aggregate profit or (loss) on contracts - formerly box 13 on 2011 form; report as stated
  • Box 13: State – new box; enter two-digit state code if state tax was withheld
  • Box 14: State identification number – new box; enter the payer’s state TIN if state tax was withheld
  • Box 15: State tax withheld - new box; enter the amount of state tax that was withheld from the amount in box 2a
  • 2nd TIN not.: You may check this box if the IRS has notified you twice within three calendar years that the payee TIN is incorrect

 

For Your Reference

 

The 2012 Form 1099-B and Instructions can be accessed by following these links: 

 

Form-pdf (52 KB)

Instructions.pdf (140 KB)

 

 

 

Form 1099-DIV (Dividends and Distributions)

 

 

Purpose of Form

 

Form 1099-DIV must be issued for each person:

 

  • To whom dividends and other distributions on stock were paid in amounts of $10 or more
  • For whom foreign tax was withheld and paid on dividends and other distributions on stock
  • For whom backup withholding was imposed on dividends and other distributions on stock
  • To whom $600 or more was paid as part of a liquidation.

 

Due Date

 

Form 1099-DIV must be filed with the IRS by February 28, 2013; if filed electronically, the extended due date is April 1, 2013. Recipient statements must be issued by January 31, 2013.

 

Changes for 2012 Reporting

 

Five new boxes were added to the form for use in 2012 reporting as follows:

 

  • Box 10: Exempt-interest dividends – amounts designated by a mutual fund or other regulated investment company as an exempt-interest dividend are to be reported in this box and not on Form 1099-INT.
  • Box 11: Specified private activity bond interest dividends – amounts designated by a mutual fund or other regulated investment company as exempt-interest dividends to the extent they are attributable to interest from private activity bonds
  • Box 12: State – enter the two-digit state code if state tax was withheld.
  • Box 13: State identification number – enter the payer’s state TIN if state tax was withheld.
  • Box 14: State tax withheld - enter the amount of state tax that was withheld.

 

For Your Reference

 

The 2012 Form 1099-B and Instructions can be accessed by following these links: 

 

Form.pdf (63 KB)

Instructions.pdf (120 KB)

 

 

For further information, please do not hesitate to contact us.

 

 

 

 

 

 

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. 

 

 

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