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URL:  http://boards.fool.com/is-there-any-limitation-on-how-late-a-corrected-30920085.aspx

Subject:  Re: 1099 in October Date:  10/12/2013  4:40 PM
Author:  ptheland Number:  119291 of 121335

Is there any limitation on how late a corrected 1099 can be issued?

Nope.

Aren't companies and brokers supposed to report this information in a timely manner?

Yes. But don't blame your broker on this one. The difference between return of capital and qualified dividends is something that has to come from the company. If the company has retained earnings, they can pay qualified dividends. If the company's retained earnings is zero or negative, payments must be return of capital and not dividends.

So I'd lay the fault for this correction on the company, not the broker.

Side note - If a company can't tell whether they have retained earnings or not within 90 days of year end, there's a problem with their management. And if there's a problem with management, that's not a company I want to own.

Since it is obviously well past the April 15 deadline; what are the rules on when I need to file an amended return and how do I avoid penalties?

The penalty for late payment is 0.5% of the tax due per month late, with a maximum of 25% of the late tax. On $6, your maximum penalty is $1.50. The IRS has discretion to waive penalties, which they would probably do for you in this case.

There's also interest, which is currently at 3% annually. At roughly 6 months late, the interest on your $6 of tax would be about a dime, give or take a penny or two.

Frankly, I wouldn't bother. The IRS generally will ignore balances below $5, and I've heard rumors the threshold is closer to $10.

--Peter
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