Important 2025 Tax Season Resources

Why Some Forms Are Delayed

Both custodians may delay issuing certain tax forms to reduce the likelihood of amended 1099s. Delays are most common for accounts holding:

• Mutual funds, ETFs, REITs, UITs, and partnership investments
• Original Issue Discount (OID) bonds
• Certain mortgage-backed securities
• Investments subject to late income reclassification or cost basis adjustments

Delaying the initial mailing often results in a more accurate final tax form and helps minimize amended returns.

Schedule K-1s and Alternative Investments

If you hold certain partnership-based or alternative investments, you may receive a Schedule K-1 instead of (or in addition to) a Form 1099.

Important considerations: 

• Schedule K-1s are issued by the investment sponsor, not by the custodian.
• They are commonly delivered close to the tax filing deadline.
• Federal rules require partnerships to issue K-1s by March 15, though many request extensions.

Because of this timing, investors who expect a K-1 may want to delay filing or consider filing an extension to avoid amended returns.

Education Accounts and Form 1099-Q

If you took a distribution from a 529 College Savings Plan or a Coverdell Education Savings Account (ESA), you may receive Form 1099-Q. This form reports the total amount distributed during the year and separates the distribution into earnings and principal.

How Form 1099-Q and Form 1098-T Work Together

Many families will also receive Form 1098-T from the educational institution. Form 1098-T reports qualified tuition and related expenses billed or paid during the calendar year and is commonly used to support education-related tax benefits.

When reviewing these forms together, it is important to understand:

• In general, qualified education expenses reported on Form 1098-T should be equal to or greater than the amount withdrawn from the 529 plan and reported on Form 1099-Q.
• When qualified expenses meet or exceed the 1099-Q distribution, the earnings portion of the 529 withdrawal is typically not subject to federal income tax.

Timing Differences Can Create Confusion

Timing is a frequent source of confusion and does not necessarily indicate a problem:

• Colleges often report expenses on Form 1098-T based on when charges are billed, while 529 distributions may be taken based on when payments are made.
• Expenses for a spring semester are sometimes billed in late December, while the related 529 distribution may occur in January of the following year (or vice versa).

Because of this timing mismatch: 

• A Form 1099-Q may temporarily appear higher than the expenses shown on Form 1098-T.
• Additional qualified expenses (such as books, supplies, required equipment, or eligible room and board) may not appear on Form 1098-T but can still count as qualified expenses.

Your tax professional will typically reconcile these timing differences by reviewing total qualified education expenses paid during the year, not just what appears on the 1098-T.

Important Reminders

• Form 1099-Q is issued to the recipient of the distribution, which may be the account owner or the beneficiary.
• Not all qualified expenses are reflected on Form 1098-T.
• Proper tax reporting depends on matching 529 withdrawals to qualified expenses incurred in the same tax year.

If you have questions about how your education-related tax forms interact, we recommend consulting your tax professional, who can help determine whether any portion of a distribution is taxable.

IRA Contributions and Reporting

You may be able to make prior-year IRA contributions up until the tax filing deadline, even if you plan to file an extension.

A few reminders:

• Contribution limits are set annually by the IRS and may vary based on age and income.
• Traditional, Roth, and non-deductible IRA rules differ and should be reviewed with a tax professional.
• Form 5498 reports IRA contributions and certain transactions and is typically issued in May.
• Form 5498 is informational only and is not required to file your tax return.

If you made a non-deductible IRA contribution, your tax preparer may need to file Form 8606 to properly track after-tax basis.

Tax Software and Do-It-Yourself Filers

Some clients prefer to prepare their own tax returns using online or desktop tax software. Depending on the custodian and the type of account you hold, you may be able to import certain tax forms directly into your software.

Commonly used platforms include:

• TurboTax®
• H&R Block®
• TaxAct®

Direct import features can reduce manual data entry, but they do not eliminate the need to carefully review your return for accuracy. Imported data should always be compared against your official tax documents.

Please note:

• Not all accounts or investment types are eligible for automated imports.
• Some forms may be available for import before they are marked “Final,” which could result in changes later.
• Schedule K-1s and certain alternative investments are typically not eligible for direct import.

Paper Filing vs. Electronic Filing

If you file a paper tax return, be mindful of mailing deadlines.

• Returns must be postmarked by the IRS deadline to be considered timely.
• Simply placing an envelope in a mailbox on the due date does not always guarantee a same-day postmark.
• Using Certified Mail or visiting a post office counter can help document timely filing.

Electronic filing is not impacted by postmark timing and may provide faster confirmation of receipt.

When to Reach Out to Our Team

We are always happy to help clarify account-specific questions, including:

• Whether a tax form has been issued or is still pending
• How to access documents through your custodian’s portal
• General questions about how investment activity is reported

For tax calculations, deductions, or filing decisions, we recommend working directly with your CPA or tax professional.