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Additional ETF Dividend dated 1/31/2007 in a corrected 1099DIV?

I received today (2/20) a 'corrected' 1099DIV from Pershing indicating an additional dividends that is reported on the updated 1099 DIV statement. But the transaction posting the money to my account in repurchased shares is dated 1/31/2007 (!). I didn't know I was getting this (bought the SPY ETF last year); I haven't filed, so it's not a big deal to change my return at this point to match the corrected

1099DIV, but is this right? Why should I have to declare a dividend that is dated 1/31/2007 on a t/y 2006 return when I never had control of the money? Yes, I know the dividend might have been declared in December, but it wasn't credited to my account until January. Or is this just the way this works? I can't ever remember having this situation before; on the other hand, I never owned a Unit Investment Trust (which is what SPY is) before either.

-- Regards -

- Andrew

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Andrew
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Certain types of entities have a period of time after the end of their tax year to distribute their income so as to avoid having to pay tax themselves. Mutual funds and ETFs are two such types of entities. If they have a 12/31 fiscal year, they will often make January distributions which individuals have to include in their prior year tax returns. That's the tax law. If you don't like it, complain to your Congressional representatives.

Ira Smilovitz

Reply to
Ira Smilovitz

Because the Internal Revenue Code says that a Regulated Investment Company distribution paid out by January 31 of Year N+1 is taxable in Year N if certain conditions are met re: when the distribution was declared by the fund.

And that's one of the conditions. Since it was declared in Year N and paid by 31 Jan Year N+1, it's taxable in Year N.

-- Rich Carreiro snipped-for-privacy@animato.arlington.ma.us

Reply to
Rich Carreiro

OK Rich and Ira - appreciate the reply - I'll make a note of this in my file to remind me again next year - thanks - I figured this was probably it. Makes sense. I guess that's perhaps a good reason not to try to file as soon as you can to ensure you have given the powers that be enough time to get ALL the paperwork to you.

-- Regards -

- Andrew /// From: Ken Meyer Subject: Re: Am I a resident? References:

Newsgroups: misc.taxes.moderated Approved: snipped-for-privacy@smart.net Precedence: first-class

Great answers, thanks everyone.

I kinda suspected the problem wouldn't be becoming an Arizona resident; the problem is getting California to let me go. From a practical standpoint, suppose I do become an Arizona resident, and did the things you recommended to reduce my California ties (aside from selling the CA house--the market it too soft right now). How likely would you say it is that this would be an audit issue? Won't their computers notice me the first year I do NOT file a California return? I'm not real enthusiastic about a step that's likely to trigger an audit whether I can ultimately prevail or not. Been there, done that. Ken Meyer

Reply to
Andrew

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