U.S. · Tax forms
1099-DIV box 1b qualified dividends.
Ordinary versus qualified dividends, capital gain distributions and the other 1099-DIV boxes.
Box 1a of Form 1099-DIV is total ordinary dividends and goes on Form 1040 line 3b. Box 1b is the part of box 1a that is qualified dividends taxed at the lower capital gains rates, and goes on line 3a. Box 1b is included in box 1a, so do not add them together. Capital gain distributions (box 2a) go on Schedule D, and box 3 nondividend distributions reduce your cost basis instead of being income.
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Result
Form 1099-DIV boxes
| Box | Meaning | Where it goes (per the IRS instructions) |
|---|---|---|
| Box 1a | Total ordinary dividends: Dividends including money market fund dividends, net short-term capital gains from mutual funds, reinvested dividends and other stock distributions. Includes boxes 1b and 2e and the investment expenses in box 6. | Form 1040 line 3b. Schedule B is required if the total is over $1,500. |
| Box 1b | Qualified dividends: The part of box 1a that qualifies for the reduced capital gains rates. Never less than zero. | Form 1040 line 3a (also included in line 3b). |
| Box 2a | Total capital gain distributions: Long-term capital gain distributions. Includes boxes 2b, 2c, 2d and 2f. | Schedule D line 13, or directly on Form 1040 line 7 when the line 7 conditions are met (for example, no capital losses and no other capital gains). |
| Box 2b | Unrecaptured section 1250 gain: The part of box 2a from certain depreciable real property. | Unrecaptured Section 1250 Gain Worksheet in the Schedule D instructions. |
| Box 2c | Section 1202 gain: The part of box 2a from qualified small business stock. | See Exclusion of Gain on Qualified Small Business Stock in the Schedule D instructions. |
| Box 2d | Collectibles (28%) gain: The part of box 2a that is 28% rate gain from collectibles. | 28% Rate Gain Worksheet in the Schedule D instructions. |
| Boxes 2e-2f | Section 897 ordinary dividends and capital gain: Only RICs and REITs complete these; not needed for U.S. individual recipients. | Not used by U.S. individuals. |
| Box 3 | Nondividend distributions: Distributions that are a return of your cost or other basis, if determinable. | Not income. They reduce your basis, and once basis is zero further distributions are capital gains on Form 8949. |
| Box 4 | Federal income tax withheld: Backup withholding when a TIN was not furnished correctly. | Form 1040 line 25b (federal tax withheld on Forms 1099). |
| Box 5 | Section 199A dividends: Qualified REIT dividends or section 199A dividends from a RIC, included in box 1a. | Used for the section 199A qualified business income deduction. |
| Box 6 | Investment expenses: The recipient’s share of certain expenses of a nonpublicly offered RIC. Included in box 1a, not in box 1b. | Included in income under section 67(c). |
| Boxes 7-8 | Foreign tax paid and country: Foreign tax on dividends, in U.S. dollars, and the country or possession. | Foreign tax credit, normally Form 1116 (no Form 1116 needed under the conditions in the 1040 instructions). |
| Boxes 9-10 | Liquidation distributions: Cash and noncash distributions in a partial or complete liquidation. Not included in boxes 1a or 1b. | Reported separately from ordinary dividends. |
| Box 11 | FATCA filing requirement: Checked when the payer is satisfying a FATCA reporting requirement. | Payer information. |
| Box 12 | Exempt-interest dividends: Exempt-interest dividends from a mutual fund or other RIC, including box 13. | Form 1040 line 2a (tax-exempt interest). |
| Box 13 | Specified private activity bond interest dividends: Exempt-interest dividends attributable to specified private activity bonds, included in box 12. | See the Form 6251 alternative minimum tax instructions. |
| Boxes 14-16 | State information: State, state ID number and state income tax withheld. | Use for your state return. |
Box 1a includes box 1b
The IRS instructions say box 1a includes the amounts in box 1b and box 2e. Qualified dividends in box 1b are not an extra amount on top of ordinary dividends. The 1040 instructions say they are also included in the ordinary dividend total required on line 3b. They are listed again on line 3a because they are taxed at the lower rates. The Qualified Dividends and Capital Gain Tax Worksheet applies those rates.
Box 2a works the other way. It is a separate amount reported on Schedule D line 13, and boxes 2b, 2c, 2d and 2f are parts of it.
Worked example
Sam has $1,000 in box 1a, $800 in box 1b, $300 in box 2a and $100 in box 3. Line 3b is $1,000 and line 3a is $800. The $300 of capital gain distributions goes on Schedule D line 13. The $100 nondividend distribution is not income: it lowers his basis in the fund shares.
Limits
Whether a dividend is qualified depends on holding-period and other rules in Pub. 550 that the payer applies when it fills in box 1b; this page does not re-test them. Tax-exempt interest dividends in box 12 can still be subject to the alternative minimum tax through box 13.
More form decoders
The qualified dividends and capital gain tax worksheet calculator, dividend yield calculator and capital gains tax calculator cover the next step. Interest is on the 1099-INT box decoder.
Sources
- Instructions for Form 1099-DIV: Specific Instructions: boxes 1a to 16. Read November 2, 2026.
- Instructions for Form 1040 (2025): Lines 3a, 3b, 25b and Nondividend Distributions. Read November 2, 2026.
- Instructions for Schedule D (Form 1040) (2025): Capital Gain Distributions. Read November 2, 2026.
IRS pages last reviewed April 30, 2026. Line numbers are those printed in the 2025 instructions and can change.
Frequently asked questions
What is box 1b on Form 1099-DIV?
Qualified dividends: the part of the box 1a ordinary dividends that qualifies for the reduced capital gains rates. It goes on Form 1040 line 3a.
Do I add box 1a and box 1b?
No. Box 1a already includes box 1b. Enter box 1a on line 3b and box 1b on line 3a.
Where do capital gain distributions in box 2a go?
On Schedule D, line 13. Parts reported in boxes 2b, 2c and 2d have their own worksheets in the Schedule D instructions.
Are nondividend distributions in box 3 taxable?
Not at first. They are a return of your cost, so they reduce your basis. After your basis reaches zero they are reported as capital gains on Form 8949.
What is box 5 on a 1099-DIV?
Section 199A dividends: qualified REIT dividends or RIC section 199A dividends, included in box 1a, which can be part of the qualified business income deduction.
Not tax advice
This page summarizes IRS instructions, mostly written for the people who prepare the form, and is not tax, legal or financial advice. The payer, a CPA or an enrolled agent can confirm what a box or code means for your return. Everything runs in your browser; nothing you enter is sent anywhere.