Instructions For Form 1099-Div - 2006 Page 5
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26An S corporation reports as dividends on Form
Box 4. Federal Income Tax Withheld
!
1099-DIV only distributions made during 2005 out of
Enter backup withholding. For example, if a recipient does not
accumulated earnings and profits. See section 1368 for
CAUTION
furnish its TIN to you in the manner required, you must backup
more information.
withhold at a 28% rate on certain dividend payments reported
Box 1b. Qualified Dividends
on this form. Use Form W-9, Request for Taxpayer
Identification Number and Certification, to request the TIN of the
Enter the portion of the dividends in box 1a that qualify for the
recipient. For foreign recipients, use the applicable Form W-8.
5% and 15% capital gains rates. Include dividends for which it
See part J in the 2006 General Instructions for Forms 1099,
is impractical to determine if the section 1(h)(11)(B)(iii) holding
1098, 5498, and W-2G.
period requirement has been met. See Qualified Dividends on
page DIV-1.
Box 5. Investment Expenses
You must report a dividend paid by a foreign corporation
Enter the recipient’s pro rata share of certain amounts
according to the guidance provided in Notice 2003-79 and
deductible by a nonpublicly offered RIC in computing its taxable
Notice 2004-71 which contain the rules for reporting the
income. This amount is includible in the recipient’s gross
dividend for tax years 2003 and 2004. These rules are
income under section 67(c) and must also be included in box
extended for 2005 and subsequent tax years by Notice 2006-3.
1a. Do not include any investment expenses in box 1b.
Notice 2003-79 is available on page 1206 of Internal Revenue
Box 6. Foreign Tax Paid
Bulletin 2003-50 at Notice
Enter any foreign tax withheld and paid on dividends and other
2004-71 is on page 793 of Internal Revenue Bulletin 2004-45 at
distributions on stock. A RIC must report only the amount it
elects to pass through to the recipient. Report this amount in
Box 2a. Total Capital Gain Distr.
U.S. dollars.
Enter total capital gain distributions (long-term). Include all
Box 7. Foreign Country or U.S. Possession
amounts shown in boxes 2b, 2c, and 2d.
Enter the name of the foreign country or U.S. possession to
For more information about reporting amounts in boxes
which the withheld tax applies.
TIP
2a through 2d, see section 1(h).
Boxes 8 and 9 apply only to corporations in partial or
!
complete liquidation. Do not include these amounts in
Box 2b. Unrecap. Sec. 1250 Gain
box 1a or 1b.
CAUTION
Enter any amount included in box 2a that is an unrecaptured
Box 8. Cash Liquidation Distr.
section 1250 gain from certain depreciable real property.
Enter cash distributed as part of a liquidation.
Box 2c. Section 1202 Gain
Box 9. Noncash Liquidation Distr.
Enter any amount included in box 2a that is a section 1202 gain
Enter noncash distributions made as part of a liquidation. Show
from certain qualified small business stock. See Qualified small
the fair market value as of the date of distribution.
business stock — RICs on page DIV-2.
Box 2d. Collectibles (28%) Gain
Enter any amount included in box 2a that is a 28% rate gain
from sales or exchanges of collectibles.
Box 3. Nondividend Distributions
Enter nondividend distributions, if determinable.
File Form 5452, Corporate Report of Nondividend
TIP
Distributions, if you pay nondividend distributions to
shareholders.
DIV-3
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