Introduction to tax forms production

Introduction to tax forms production

The production of various tax forms occurs throughout tax season. The production timeline of each form is dependent on the availability of the information required to generate the forms.

To ensure timely tax reporting while limiting corrections, Schwab produces Form 1099 Composite in two separate production runs, based on the types of investments held, and the date during which trading occurred in the account. For more information, see Initial Form 1099 Composite production timeline.

Schwab is required to produce corrected 1099 forms within 30 days of becoming aware of an action that results in different tax reporting amounts. If the amount exceeds the minimum threshold, a corrected form is required. Corrected, reportable items are easily identifiable on the form. For a timeline and examples of corrected forms, see Form 1099 Composite corrections.

An adjusted tax form for the prior year can be triggered in two different ways:

  1. If a reportable item Tooltip was changed, a corrected tax form is triggered automatically. The corrected information on the tax form is reported directly to the Internal Revenue Service (IRS).
  2. If a non-reportable item Tooltip was changed and an updated form is requested by the advisor or client. This type of change does not automatically trigger a new 1099 and the request must be entered manually. This form is produced as a courtesy for the client. It may be necessary for the client to make updates directly with the IRS.

For more information, see Form 1099 Composite production FAQs.

Form 990-T must be produced and reported to the IRS by Schwab for unrelated business taxable income (UBTI) received from partnership positions held in a retirement account. In some instances, Schwab must work with the client to obtain the information needed to create and file Form 990-T as well as any tax that may be due.

Because the Schedule K-1 is sent directly to the client from the partnership entity, Schwab is dependent on the client to provide a copy of the tax form(s), including any supplemental pages, for Non-Master Limited Partnership (non-MLP) positions to produce and file Form 990-T.

  • Positions listed on either or are considered Master Limited Partnerships (MLPs) and provide Schedule K-1 forms directly to Schwab. Schedule K-1 tax forms received for positions not listed on the previously mentioned websites must be submitted to Schwab by the end-client.

The process to produce Form 990-T has multiple steps, beginning with the initial communication sent to the end-client, ending with the generation of Form 990-T, if necessary. Details of the process are displayed on the Form 990-T communication and production timeline.

As an advisor, you are uniquely positioned to assist the client in this process and make it as seamless as possible. For guidance, see Form 990-T reporting – Assisting your client.

For more information, see Form 990-T production FAQs.

Accounts may receive other tax forms or reports in lieu of or in addition to Form 1099 Composite. These forms include Standalone 1099-MISC, Form 1099-NEC, Puerto Rico 480 Series, Substitute Form 1099-OID (REMIC), Form 1042-S, Schedule K-1, Form 2439 and/or Form 1099-C. Accounts deemed as non-taxable (but subject to tax reporting) may be eligible to receive an Account Summary Report (ASR).

The tax forms are produced during different times of the tax season and have a separate schedule for corrected tax forms. Typically, this is caused by a delay in the information required to produce the tax form. The timeframes are approximate and are subject to change. For a complete timeline, see Tax forms and reports production schedule.

For more information, see Tax forms and reports production schedule FAQs.

Introduction to account type tax reporting
Introduction to tax forms

See the following resources to assist you with tax forms production:

Initial Form 1099 Composite production timeline
Form 1099 Composite corrections
Form 1099 Composite production FAQs
Form 990-T reporting – Assisting your client
Form 990-T communication and production timeline
Form 990-T production FAQs
Tax forms and reports production schedule
Tax forms and reports production schedule FAQs

If you have questions about cost basis reporting, statement preferences, and tax reporting, contact your service team or call Advisor Services Cost Basis Service Tooltip  at 877-762-6446.