Fidelity sent me a corrected 1099 today. I have alread filed my 2023 tax return and the refund was in the bank 5 days later. Done deal right? No way Jose. Now you have to deal with an ammended return.
I went down this road several years ago and for three (3) years in a row I had to file ammended returns. I finally dumped the REIT that was causing the issue.
I don’t remember how I found the offending security back then but I want to use the same stategy this time around once I’ve completed the ammended return.
Is there any way by just looking at the corrected 1099 which security is the culprit? The two line items that changed were the “Total Ordinary Dividends” and the “Total Capital Gain Distributions”. The total change was $4.
I wish these companies would hire employees that know what they are doing. It’s a real PITA to have to do this all the time.
You can be assured they will be rewarded when I dump their offending stock.
I would do nothing. If the dividend and capital gains totals are less, the IRS might send you a check.
If the totals are more, indeed you should owe more - but the one time I just plain forgot about a small amount of interest, I got a nice letter from the IRS saying I had omitted the amount of income and I needed to pay a bit more.
I sense the IRS does not worry about amounts under a dollar. If your marginal rate is under 25%, the added tax could not be over $1.00 – add to that most dividends and capital gains are taxed at 15%
I am sure my lackadaisical approach will corrected by the tax experts.
Not just by looking at the corrected 1099. You need to compare the original 1099 to the corrected 1099 - specifically, the section that Fidelity titles “Details of 1099-DIV Transactions” - you should be able to figure out which security changed their distributions.
That said, a $4 change is unlikely to change anything on your tax return. I would suggest waiting until the IRS sends you an inquiry about the change before bothering to file an amendment, unless you have plugged the change into your tax return and it actually does change something.
I wouldn’t be so fast to blame it on mistakes by the employees, especially for those securities (like many REITs, ETFs and mutual funds) that invest in other companies. The REIT/ETF/mutual fund has no control over how the companies they invest in classify their income, and are only passing on those changes to you when they are notified of them. Changes to income classification can occur when a company figures their actual income tax filing and it doesn’t match with original forecasts.
The only way you will ensure that you will completely avoid corrected 1099s is to not invest in securities that issue 1099s.
I also received a corrected 1099 after having received my tax rebate. I simply compared what I entered in Turbo Tax to the new document, made the adjustment in the file, and resubmitted for free.
I received a $2 check in the mail last week for the difference.
