It’s Tax Season!
The 2018 BBNC 1099 tax forms have all been mailed to shareholders in January. You may notice that your form only reflects three (3) dividend payments. This is because the December 2018 distribution was paid out of the newly created Bristol Bay Settlement Trust that was approved by BBNC shareholders at the annual meeting last October. The December 2018 distribution benefit made from the Trust to shareholders is a tax-free distribution for income tax purposes.
Some shareholders received a second 1099 form if they received 7(j) payments and shareholder door prize winnings. The 1099 forms reflect payments including:
- Quarterly dividends (reported in boxes 1a and 1b on Form 1099-DIV)
- 7(j) resource payments (reported in box 3 on Form 1099-MISC)
- Shareholder door prize winnings (reported in box 3 on Form 1099-MISC)
Dividends: BBNC paid a total of $9.35 per share ($935 for 100 BBNC shares) for your March 2018 dividend and $10.10 per share ($1,010 for 100 BBNC shares) for your June and September dividends. Shareholders owning 100 shares received a total of $2,955 (one dividend of $935 and two dividends of $1,010) in BBNC dividends for 2018. These are reported on Form 1099-DIV in box 1a (Total ordinary dividends) and box 1b (Qualified dividends). Qualified dividends are eligible for reduced capital gains tax rates.
BBNC Settlement Trust Distribution Benefit: BBNC paid a total of $10.10 per share ($1,010 for 100 BBNC shares) as a Distribution Benefit from the BBNC Settlement Trust in December. The Distribution Benefit is not taxable for income tax purposes and is not reported on Form 1099.
Quarterly Elder Settlement Trust Distributions: BBNC paid a total of $125 per quarter to original BBNC shareholders age 65 and over. All original BBNC shareholders age 65 and over received a total of $500 in 2018. Elder settlement trust distributions received in 2018 are not taxable and have not been reported on Form 1099.
ANCSA 7(j) Payments: At-large shareholders received $19.20 per share ($1,920.00 for 100 shares) 7(j) resource payment in 2018. If you are an at-large shareholder, your 7(j) payment is reported on Form 1099-MISC in box 3 (Other income). The 7(j) payment derives from resource sharing among the 12 regional corporations as required by the Alaska Native Claims Settlement Act (ANCSA). The 7(j) payment appears on a different form because resource revenue payments are not dividends and are not considered investment income. Village corporation shareholders do not receive a 7(j) dividend as ANCSA requires that resource revenue be paid directly to the village corporations.
BBNC cannot provide tax advice and shareholders are encouraged to consult with a tax advisor regarding individual circumstances and applicable federal and state tax requirements. Please remember that it is your responsibility to accurately report your BBNC income on your tax returns.
The following village distributions were taxable for 2018:
5. Bay View
6. Pedro Bay
The following village distributions were non-taxable, so 1099s were prepared only for those that had IRS withholdings deducted:
2. Far West
The following village distributions were non-taxable and no shareholders were on IRS withholding so no 1099s were prepared:
*Taxability of the village distributions is determined by the Village Corporation and their accountants then communicated to us in writing. We do not determine taxability of these distributions. Please contact your village corporation if you have any questions.