Personal Finance (Not Investing) • Underpayment Penalty Form 2210: Actual (Vanguard) vs Estimated (Schwab) Q1 thru Q3 Annualized Income Data

The Schwab 1099-DIV is comparatively limited and simpler (not a bad thing!) as to the details. Schwab's 1099-DIV indicates all foreign tax and 199A dividends occur in Q4 (actually Jan of following year applied to prior year Q4). That makes things easy!

But for qualified dividends, Schwab doesn't indicate specific distribution dates.

Foreign tax, 199A dividends, qualified dividends, and all the other groupings generally are "paid" throughout the year with each distribution. 90%+ of the time these payments are in the same proportion for each distribution payment. Therefore calculate:

(special grouping) / (total annual distribution)

Then for each 2210 interval:

(distribution to date) * (above calculated ratio)

FYI, the Paid/Adjusted in 2024 for 2023 does not mean that the payments were in January. It means that the foreign tax, 199A, and qualified numbers were not know until the funds released data after the end of the tax year. During the year, you did not receive dividends. You received distributions. What the column is doing is "moving" funds from distributions into the other groupings. What is left become unqualified dividends. A gotcha is that some funds do make a Q4 payment in January (2024). This will also be included in the Paid/Adjusted column.

Statistics: Posted by PGR — Tue Mar 26, 2024 10:39 pm — Replies 5 — Views 252