Points to know
- 1099 forms report income (including investment income) to you and the IRS.
- Other forms are less common, but you may receive them for certain transactions or types of investments.
In general, 1099 forms report income other than wages. There are several types of 1099 forms.
As an investor, you might receive these forms:
Other types of 1099 forms are less common, but you might receive them if you invest in certain types of securities or accounts, or if you perform certain transactions. These include:
An increase in the value of an investment over the initial purchase price. A capital gain is "unrealized" until the investment is sold, when it becomes a realized gain. Realized gains are taxable and they may be considered short-term (if the investment was owned one year or less) or long-term (if the investment was owned for more than one year).
The distribution of the interest or income produced by a fund's holdings to its shareholders, or a payment of cash or stock from a company's earnings to each stockholder.
Income you can receive by investing in bonds or cash investments. The investment's interest rate is specified when it's issued.
A type of investment account that offers federal and state tax benefits to people saving for higher education. These plans are sponsored by particular states but are usually open to anyone. The money in a 529 savings plan can be used for tuition and other qualified higher education expenses at thousands of colleges, universities, graduate schools, and trade and technical schools in the United States and abroad. You can also use your 529 assets for K–12 tuition of up to $10,000 per student per year for enrollment or attendance at a public, private, or religious school.
A loan made to a corporation or government in exchange for regular interest payments. The bond issuer agrees to pay back the loan by a specific date. Bonds can be traded on the secondary market.
A type of investment that pools shareholder money and invests it in a variety of securities. Each investor owns shares of the fund and can buy or sell these shares at any time. Mutual funds are typically more diversified, low-cost, and convenient than investing in individual securities, and they're professionally managed.
A type of account created by the IRS that offers tax benefits when you use it to save for retirement.
A type of IRA that allows you to make after-tax contributions (so you don't get an immediate tax deduction) and then withdraw money in retirement tax-free as long as you meet the requirements.
GOOD TO KNOW
The forms you receive may differ depending on whether you invest through funds or individual securities. For example, interest from individual bonds is reported on Form 1099-INT, but interest from bonds held through a mutual fund is called an "interest dividend" and reported on Form 1099-DIV.
There are several other forms you might receive from Vanguard. Here are the most common.
GOOD TO KNOW
You can find information for specific Vanguard funds that you may need for your tax reporting, including information about fund distributions, qualified dividends, intercorporate dividends, and income from government obligations.
Most tax forms are required to be provided only for amounts of $10 or more, or if taxes have been previously withheld. However, you must report any investment income or distributions you receive to the IRS. All investment income or distributions during the year are reported on your year-end mutual fund or brokerage account statement.
Vanguard's advice services are provided by Vanguard Advisers, Inc. ("VAI"), a registered investment advisor, or by Vanguard National Trust Company ("VNTC"), a federally chartered, limited-purpose trust company.
The services provided to clients will vary based upon the service selected, including management, fees, eligibility, and access to an advisor. Find VAI's Form CRS and each program's advisory brochure here for an overview.
VAI and VNTC are subsidiaries of The Vanguard Group, Inc., and affiliates of Vanguard Marketing Corporation. Neither VAI, VNTC, nor its affiliates guarantee profits or protection from losses.