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Happy New Year | Tax Tip of the Week | No. 74 January 5, 2011

Posted by bradstreetblogger in : Tax Tip, Taxes, Uncategorized , trackback

And Get Ready for the Tax Filing Season.

Hopefully, you followed some of the suggestions we outlined last year to organize your records.  If you did, great!  This will make filing your tax returns a lot easier this year.  It also means that you and your tax advisor can spend more time on tax and financial planning issues for 2011 vs. looking back to 2010.

If you are new to our Tax Tip of the Week series, or didn’t follow our suggestions last year, now would be a good time to review our getting organized tax tip.   You might want to make getting organized your 2011 New Year’s Resolution!

This week we will look at some of the more common forms that you should be watching for in the coming weeks and months:

W-2: Employers should mail these by 1/31/11.  If you have moved during the year, make sure former employers are aware of your new address.

W-2G: Casinos, Lottery Commissions and other gambling entities should mail these by 1/31/11 if you have gambling winnings above a certain threshold.
NOTE: Some casinos will issue you a W-2G at the time you win a jackpot.  Make sure you have saved those throughout the year.

1099-INT: Banks, Credit Unions, Brokerage firms, etc. will issue these by 1/31/11 to show the amount of interest income you earned on your savings/investments.

1099-DIV: Brokerage firms, mutual funds, etc. have until 2/14/11 to issue these forms to show the dividend income you earned for the year.

1099-B: Brokerage firms, mutual funds, etc. have until 2/14/11 to show the proceeds from the sale of stocks and mutual funds.   Most brokerage  firms have gotten better at showing the cost basis on the sale of these investments.  If the statements do not show the basis, then you have some homework to do before filing your tax return.
NOTE: Most of the larger brokerage firms issue “Consolidated Statements” that have the 1099-INT, 1099-DIV and 1099-B earnings reported on the same report.

K-1s: If you are a partner in a business or a limited partner in some investments, your income and expenses will be reported to you on a K-1.  The tax returns for these entities are not due until 4/15/11 (if they have a calendar-year accounting).  Sometimes, you may not receive a K-1 until shortly after the entities’ tax return is filed in April.

If you are a beneficiary of an estate or trust, your share of the income and expenses for the year will also be reported on a K-1.  The timing of when you may receive your K-1 is the same as outlined above.

NOTE: Many times partnerships, estates and trusts will put their tax returns on extension.  If they do, the due date of the return is not until 9/15/11.  We often see clients receiving K-1s in the third week of September.

If you receive, or expect to receive, a K-1 it may be best if you place your personal return on extension.  It is a lot easier to extend your return than it is to amend your return after receiving a K-1 late in the year.

So start watching your mailbox and put all of these statements you receive in that new file you created!
You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.


1. Ray - March 26, 2011

Hi, I have one question.

I receive K-1 form from UNG stock and the broker also issues me 1099-INT about UNG stock, do I need to report K1 and 1099-INT together? It seems double entry.



2. admin - March 30, 2011

Hi Ray,

It is somewhat hard to say without seeing the documents, but I think it is safe to say that yes both do need reported on your 1040. The IRS has received a copy of both the 1099-INT and the K-1 and will be looking to match both up to your return. Usually the income reported on the K-1 is a different type of income than the income reported on the 1099-INT. Hope this helps, we appreciate your readership & your commentary! Thank you, Lance Bradstreet