Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 65-23

1965-1 C.B. 520

Full Text

Rev. Rul. 65-23 /1/

Revenue Ruling 64-290, C.B. 1964-2, 465, holds that dividends payable December 31, 1963, and paid by check mailed on that date so that the check could not have been received by the shareholder until January 1964, should be reported on Forms 1099, U.S. Information Return for Calendar Year, and 1096, U.S. Annual Information Return, as having been paid in 1964.

Under Revenue Ruling 64-290 the Internal Revenue Service hopes to attain maximum accuracy in the matching of the amounts reported by the paying corporation on information returns with the amounts reported on the income tax returns by the recipients of the dividends.

The reporting under Revenue Ruling 64-290 of the dividend distribution on the 1964 information returns does not, however, govern the date of determining the taxable status of such distribution. The taxable status and the effect on earnings and profits of the paying corporation of distributions payable on December 31, 1963, and paid by check mailed on December 31, 1963, which checks could not have been received by the shareholder until 1964, is determined by reference to the earnings and profits of the taxable year ending December 31, 1963, or the accumulated earnings and profits at December 31, 1963, of the paying corporation.

Corporations which believe that distributions made during 1964 are partly or wholly not taxable as dividends are required to complete the schedule, TOTAL DISTRIBUTIONS MADE TO SHAREHOLDERS DURING THE CALENDAR YEAR 1964, appearing in the lower part of Form 1096. The amounts shown on this schedule should not include the distributions payable on December 31, 1963, and paid by check dated and mailed December 31, 1963, but should include distributions payable December 31, 1964, and paid by checks dated and mailed on December 31, 1964.

The 1964 summary report of Forms 1099, 1099L, and 1087 shown on the top of Form 1096 will reflect amounts received by shareholders in 1964. However, the schedules on the lower part of Form 1096 of distributions and of earnings and profits should reflect 1964 transactions whether or not received by shareholders in 1964.

Revenue Ruling 64-290 is hereby amplified.

/1/ Also released as Technical Information Release 676, dated Jan. 15, 1965.