Summary of Reporting Investment Income on Your Federal Tax Returns

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Summary of Reporting Investment Income on Your Federal Tax Returns

All income, whether earned from work or resulting from investments, is subject to tax reporting and taxation. Financial institutions send annual informational tax returns to the IRS and to individual taxpayers showing imputed income to the taxpayer. It is the taxpayer’s responsibility to verify that this information is correct.

Individual taxpayers (and those filing jointly) are required to complete an annual income tax return form to verify income and taxes due and paid. Tax forms are complex, and many taxpayers elect to get help either from the IRS, paid tax preparers, or others. Nevertheless, it is the individual taxpayer who is ultimately responsible for accurate reporting and paying the correct amount of income tax.

The IRS forms use many schedules to help taxpayers organize their information so that the correct tax rates may be applied and the correct amount of tax assessed. To help taxpayers complete their income tax return forms, the IRS provides free publications on a variety of tax subjects relating to the completion of tax returns. These publications are also available online for download as PDF files.

When you receive informational returns from financial institutions, verify that they are accurate. Use the corrected information on the appropriate tax form schedules to complete your returns. Remember, ultimately you are responsible for a filing a correct return and paying the correct amount of income tax.

What you have learned

  1. What Investment Income Is Taxed?
  2. Investment Information Tax Forms
  3. IRS Tax Forms Used to Report Your Income
  4. What Are IRS Tax Schedules?
  5. Useful IRS Publications

Find out what you have learned