Merrill Lynch Tax Reporting Statement - 1099 Misc

[Yardley CPA]

Merrill Lynch Tax Reporting Statement includes an amount in the miscellaneous information section of $5,500.  In revieing the statement further, it shows the income as "Other Income from Canada" which was reported to the IRS.  I assume this is simply listed on the return as just that, Other Income...flowing to a 1099 Misc and reflected on Line 8 of the 1040?

[Lion EA]

Is a K-1 expected? What does your client (or his broker) say that income is from? Did the account balance at any time during the year trigger any foreign income/assets filing?

[Abby Normal]

22 minutes ago, Yardley CPA said:

flowing to a 1099 Misc and reflected on Line 8 of the 1040

That's what I've always done. It's been reported to the IRS, just like any other 1099MISC.

[Gail in Virginia]

I would be concerned that if he/she has income of $5000 from Canada, the underlying asset might be worth more than $10,000 at some point during the year and trigger a FBAR filing.  Or even worth $100,000 and trigger the need for an 8938 with the tax return.  

[Abby Normal]

21 minutes ago, Gail in Virginia said:

I would be concerned that if he/she has income of $5000 from Canada, the underlying asset might be worth more than $10,000 at some point during the year and trigger a FBAR filing.  Or even worth $100,000 and trigger the need for an 8938 with the tax return.  

But it may not be a foreign account. I have all kinds of brokerage 1099s with foreign income but the income is all held in a domestic account so there are no FBAR issues. And none of my clients with actual foreign financial accounts have ever received a 1099.

[Gail in Virginia]

1 hour ago, Abby Normal said:

But it may not be a foreign account. I have all kinds of brokerage 1099s with foreign income but the income is all held in a domestic account so there are no FBAR issues. And none of my clients with actual foreign financial accounts have ever received a 1099.

Very true, but that is the reason I would want to know what it is because it is not being reported as simple dividends.