Background Information
Acme Finance Group Investment Services (AFGIS) is the broker-dealer for AFGIS brokerage and AFGWMC advisory accounts. AFGIS is required to report the following to the IRS: income earned, gross proceeds, covered positions, and covered cost basis for assets sold in tax reportable accounts.
AFGIS performs tax reporting. Information provided here is intended to assist with tax reporting - it does not constitute tax advice. Representatives must always refer clients to a qualified tax professional for information specific to their tax situations.
Important Facts
- Earnings (dividends and interest) greater than $10 will generate a Tax and Year End Statement (consolidated IRS forms 1099) in Mid-February.
- Joint account tax reporting is filed by Pershing with the first person's name and SS# listed on the account. Review joint accounts to ensure the proper name is associated with the SS# on the account.
- S Corporations can be exempt or non-exempt. For an exempt S Corporation only, the sale of covered securities displays on IRS Form 1099-B.
- Any SS/TIN# changes made after year-end automatically generate a revised Tax and Year End Statement for the prior year. If a revision was generated in error, contact Northwestern Mutual Investment Services, LLC (NMIS) tax support at (866) 487-4433.
1099 Forms
| Form | Description |
| 1099-B | Reflects proceeds from securities transactions (e.g., sales, redemptions, tender offers, return of principal distributions, covered options, and option premium portion of reverse convertibles and bond maturities). Cost or other basis, type of gain or loss (short-term or long-term), whether any loss is disallowed due to a wash sale and market discount for both covered and noncovered securities transactions displays when available. Such detail for noncovered transactions is not reported to the IRS. |
| 1099-INT | Reflects interest paid in the calendar year earned from U.S. corporations, U.S. government agencies, foreign sources and credit interest. May also include Investment Expenses and Foreign Tax Paid. |
| 1099-DIV | Reflects qualified and ordinary dividends and other distributions from corporations, mutual funds, ETFs (treated as mutual funds for tax purposes), UITs and REITs. May also include state tax withheld. |
| 1099-OID | Original issue discount (OID) is a form of interest. It is the excess of a debt instrument's stated redemption price at maturity over its issue price (acquisition price for a stripped bond or coupon). Zero coupon bonds and debt instruments that pay no stated interest until maturity are examples of debt instruments that have OID. |
| 1099-MISC | Includes substitute payments in lieu of dividends or interest. Example: If a security is on loan for margin, substitute payments are made instead of dividends or interest. |
Phased Mailing of Taxable Accounts
Based on the holdings in the account, Pershing, LLC mails Tax and Year End Statements (IRS Form 1099) in phases.
| Timing | Description |
| Phase One: January 31 | Accounts holding simple debt or equity-only investments along with accounts without pending income reclassifications from the issuer. All Retirement 1099RS and 1099Qs will be issued at this time. |
| Phase Two: February 15 | Accounts in which income reclassifications were received after Jan. 31. If the account holds positions for which issuers have not provided final tax information, the client will receive a Pending 1099 notice identifying the holdings that delayed the mailing date of the 1099s. The notice will also provide the anticipated mailing date of the forms. Clients receiving their 1099s will not receive this notice |
| Phase Three February 28 | Accounts in which income reclassifications were received after Feb. 18. Generally, this includes mutual funds, unit investment trusts (UITs), real estate investment trusts (REITs) and certain equities. |
| Phase Four: March 15 | All remaining accounts, including those holding certain complex, non-equity securities, such as real estate mortgage investment conduits (REMICs), widely held fixed investment trusts (WHFITs) and some UITs. |
* While financial institutions are required by law to provide IRS Form 1099B, 1099DIV, and 1099INT documents by February 15, they may also submit IRS Form 8809 which grants an automatic 30-day extension. Pershing has filed this extension.
Requesting a Correction
Contact (888) 123-4567 for Acme Finance Group Investment Services, for tax support if there is a tax reporting error.
P.S. Edited version