Tax Forms

Updated on March 13, 2019

Tax Forms Thumbnail

If you’ve sold stocks or received dividends from any of your investments, you’ll have to include the capital gains or losses on your taxes. At the beginning of every year, your online broker will send you tax forms that summarize your net gains or losses from the previous year. You can choose to get these forms mailed to you or even to receive them directly within your trading app as an electric copy. Tax forms vary by country, but in the U.S., most investors will be sent three forms:

Let’s look at Form 1099-B first.

1099-B

Form 1099-B will be sent to every investor that sells an investment. This form will list your transactions for the year and summarize your net capital gain or loss. Submitting your 1099-B form to the IRS is very important because capital gains are taxable income and capital losses can be deducted.

1099-DIV

Form 1099-DIV will be sent to every investor that has received a dividend. Whether you’ve reinvested your dividends or received them as cash, the total dividend amount will still be taxed. A 1099-DIV will summarize these transactions, making it easier for you to include them in your tax filing.

1099-INT

Form 1099-INT is specifically for your bond investments. The interest your bonds earn will be taxed on a yearly basis. A 1099-INT will summarize your interest earned, allowing you to easily report it to the IRS.

Multiple Accounts

If you happen to have multiple online stock brokers, you will receive these forms from each one. For instance, if you have two brokers and you sell investments through each one, you will receive tax forms from both. The forms from each broker will need to be included in your tax filing since a broker will only send you information about the transactions you made in their app.

Key Takeaways

Whether you file your own taxes or let a professional handle them, you’ll want to make sure you understand your tax forms and how they affect your taxes for the year.