Part IV. – Items of General Interest IRS Announcement 2008-56 – Change in Reporting Section 404(k) Dividends Employee stock ownership plans; dividends; section 404(k); reporting. This announcement provides for a change in the reporting of dividends on employer securities that are distributed from an employee stock ownership plan under section 404(k) of the Code. Announcement 85-168 revoked. Announcement 2008-56 states that beginning with distributions in 2009, the reporting of dividends on employer securities that are distributed from an employee stock ownership plan under section 404(k) of the Code must be on a Form 1099-R that does not report any other distributions. New Reporting Effect on Other Documents Announcement 85-168 is revoked. Related Links:
Distributions from a plan that are made in 2009 or later years and that are § 404(k) dividends must be reported on a Form 1099-R that does not report any other distributions, in accordance with the instructions to the form. Accordingly, if there are other distributions from the plan in such years that are not § 404(k) dividends, they must be reported on a separate Form 1099-R. It is anticipated that the instructions will require a special code in box 7 of the form to indicate the special tax treatment and rollover restrictions applicable to § 404(k) dividends. Payments of § 404(k) dividends made directly from the corporation to the plan participants or their beneficiaries are reported on Form 1099-DIV in accordance with the instructions to that form.
- IRC Section 404(k) - Deduction for dividends paid on certain employer securities
- IRC Section 316 – Dividends defined
- C Corporations, Deduction Limits, 404(k) Dividends, and Reasonable Compensation
- Dividends and S Corporation Distributions of Earnings
- Benefit Payment Government Filings
