On Apr 28, 11:14 am, "Andrew" <and...[at]jkl.com> wrote:

- quote -

True. However, in the OP's case, it looks like the tax after applying
the change is the same or less than before, depending on whether the
$4.89 liquidation distribution is taxable or not (usually it is not
taxable as it is a return of capital). So his tax would decrease --
best case by about $10, worst case by $0 (because of the rounding (eg.
all income from 50000 to 50050 has the same tax).

- quote -

I think so.

- quote -

If you get a CP2501 letter, just write back with the facts and file an
amended return. It's nothing to worry about really. But just my gut
feeling is that you won't get a CP2501 even if your income did
increase $10.

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removeps-groups[at]yahoo.com wrote:
- quote -

I am not trying to be funny here, but why (or perhaps, how) do you say this?
I've seen others in the NG state that even if one doesn't receive a 1099 for
an interest payment from a FI below $10., one still needs to declare it as
income. And in that case, I don't even think the IRS gets the reported
income.

In this case, they DO receive the corrected data, right?

So, what you say may be true from a practical sense, can you cite anything
that says you can forget about the amended return? Being a worry wart,
short of seeing an official IRS statement, I sure would. And what if I were
audited? Would some cryptic words like "Oh, I didn't report that?
Something I read from an anonymous source on the internet said I didn't have
to worry about correcting additional income" should wouldn't look good in my
mind.

But again, I'm just an interested party to the discussion.
--
----------------------------- Regards -

- Andrew

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In article <fv2vlc$nn5$1[at]reader2.panix.com> , Seth <sethb[at]panix.com> wrote:
- quote -


The financial institution does have a de minimis reporting requirement
of anything under $10. But for corrections, there is no de minimis
amount.
--


ArtKamlet at a o l dot c o m Columbus OH K2PZH

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In article <fSKQj.1172$506.233[at]newssvr27.news.prodigy.net> ,
Mark Bole <makbo[at]pacbell.net> wrote:
- quote -

They're required to get it correct. And they might have some
customers with 1000 times the position, for whom it does matter. (And
the largest part of the cost is the snailmail, sending lots of data to
the IRS is cheap.)

Seth

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removeps-groups[at]yahoo.com wrote:
- quote -

Which begs the question, why does the financial institution bother, and
do they bother sending these changes in to the IRS? Who is paying all
the overhead costs for this, if it's not necessary?

-Mark Bole

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removeps-groups[at]yahoo.com wrote:
- quote -

Thanks so much for confirming my thoughts on this.

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On Apr 25, 3:32 pm, MrTom <NotMyAddr...[at]invalid.net> wrote:

- quote -

No, it doesn't matter. The cost of processing time to both you and
IRS agents is not worth it. BTW, assuming the liquidation
distribution is not taxable (ie. is just a return of your capital, or
in other words the basis in the stock was more than $4.89), the effect
of the above is to reduce your ordinary income by 7.35-2.46=4.89. It
seems ETrade is re-characterizing dividends as interest and
liquidation. For incomes under 100k, the taxable income is rounded to
the nearest $50; for example, all taxable incomes 50000 to 50050 have
a tax of 8930, so if your taxable income was 50040 before the amended
1099, your income after is less but yields the same tax. But if you
dropped to the previous bracket, your tax would be 8918, and you would
get $12 back. If your income is over 100k, you would get back about
0.28*4.89.

Now if you ever have to amend your return for other reasons, then be
sure to include the reduction of $4.89, otherwise don't worry.

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Today I received a corrected consolidated form 1099 from ETrade. The
changes were

An increase of $2.46 in Interest Income.

A decrease of $7.35 in both Total Ordinary Dividends and Qualified
Dividends.

An increase of $4.89 in Cash Liquidation Distributions.

Do the IRS and/or the state of California care about such minuscule
changes? Must I, or should I, file amended returns? How should I
handle this, what would you do?

Thanks.

Tom

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >