1 This year-end information often is referred to as “reclassified” tax information because of the practice
at many brokerage firms and banks to treat distributions from RICs and REITs as ordinary income until
advised to “reclassify” the income, such as to long-term capital gain.
[10301]
September 22, 1998
TO: TAX MEMBERS No. 30-98
ACCOUNTING/TREASURERS MEMBERS No. 24-98
OPERATIONS MEMBERS No. 24-98
BROKER/DEALER ADVISORY COMMITTEE No. 14-98
TRANSFER AGENT ADVISORY COMMITTEE No. 59-98
RE: YEAR-END TAX REPORTING PROCEDURES
______________________________________________________________________________
The Institute has been working closely this year with the Securities Industry Association (“SIA”),
the American Bankers Association (“ABA”) and the National Association of Real Estate Investment
Trusts (“NAREIT”) to improve the uniform reporting procedures pursuant to which regulated
investment companies (“RICs”) and real estate investment trusts (“REITs”) will report “reclassified” 1
year-end tax information.
For 1998, this year-end tax information will be reported to brokers and banks using the attached
“primary” and “secondary” uniform file formats. The 1998 primary uniform file format contains the
information required to prepare IRS Forms 1099 for RIC shareholders. The 1998 primary uniform file
format retains the standard nomenclature adopted last year for the different “types” of long-term capital
gains (i.e., 28 percent rate gain, 20 percent rate gain, unrecaptured section 1250 gain and section 1202
gain). The 1998 secondary uniform file format is new and will enable RICs to provide to brokers and
banks 1998 year-end income breakdowns (1) by State for municipal bond funds and (2) by type of
security (i.e., Exempt Federal Securities, GNMAs & FNMAs, Repurchase Agreements and Other Non-
exempt Securities) for other bond funds.
The remainder of this memorandum summarizes agreements reached with respect to the
following two aspects of year-end tax reporting: (1) the reporting to brokers and banks by RICs of 1998
year-end tax information and (2) the reporting to RICs by REITs of 1998 year-end tax information.
Reporting to Brokers and Banks by RICs of Year-End Tax Information
The SIA will update the listing of tax contacts at wirehouse, national and regional brokerage
institutions from last year. The SIA has requested that the RICs provide to the persons listed as “tax
contacts” at the brokerage firms (1) all year-end tax information on the 1998 primary uniform file format
on or before Friday, January 8, 1999 and (2) all year-end tax information on the 1998 secondary uniform
file format on or before Friday, January 15, 1999. The SIA also has requested that each RIC provide the
name of a “tax contact” to whom the brokers and banks may direct inquiries regarding the RIC’s 1998
year-end tax information. The Institute has agreed to compile a listing of tax contacts at the RICs.
Reporting to RICs by REITs of Year-End Tax Information
To ensure that the REITs provide accurate and timely year-end tax information to holders of
REIT interests (including RICs), the Institute will provide to NAREIT a list of RIC “investor contact
persons” to whom NAREIT’s members will send year-end tax information (via e-mail, fax or other
medium). This information will be provided to the contact persons as soon as it becomes available (and
hopefully no later than Friday, January 8, 1999, as requested by the SIA). As in prior years, the Institute
has requested that NAREIT’s members provide “best estimates” early in December but has been
advised that estimates generally will not be available until January.
ACTIONS REQUESTED:
1. RIC Tax Contacts List -- Please provide to the Institute’s Gloria Davis by e-mail (to
gdavis@ici.org) or by fax (to 202.326.5841) -- no later than Friday, October 9 -- the following
information regarding the person (“Tax Contact”) responsible for preparing the RIC’s 1998 year-end tax
information to be reported to brokers and banks on the 1998 primary and secondary uniform file
formats:
Name of Tax Contact: _______________________________________
Tax Contact’s Firm:
_______________________________________
Telephone Number of Tax Contact:
_______________________________________
Facsimile Number of Tax Contact:
_______________________________________
E-mail Address of Tax Contact (if available): _______________________________________
Mailing Address of Tax Contact:
_______________________________________
_______________________________________
_______________________________________
2. REIT Information List -- If you or someone in your firm would like to be included on
NAREIT’s listing of persons to receive REIT information (“REIT Contacts”), please provide to the
Institute’s Gloria Davis by e-mail (to gdavis@ici.org) or by fax (to 202.326.5841) -- no later than Friday,
October 9 -- the following information:
Name of REIT Contact:
_______________________________________
REIT Contact’s Firm:
_______________________________________
Telephone Number of REIT Contact: _______________________________________
Facsimile Number of REIT Contact:
_______________________________________
E-mail Address of REIT Contact (if available): _______________________________________
Mailing Address of REIT Contact:
_______________________________________
_______________________________________
_______________________________________
All information will be provided by NAREIT’s members directly to the designated REIT Contact.
Questions regarding year-end tax reporting may be directed to the undersigned at 202.371.5436.
Specific questions regarding the uniform file layouts for use by RICs in reporting year-end tax
information to brokers and banks may be directed to Justine Phoenix of the Institute’s Operations
Department at 202.326.5850.
Deanna J. Flores
Assistant Counsel
Attachment
Note: Not all recipients of this memo will receive an attachment. If you wish to obtain a copy of the
attachment referred to in this memo, please call the Institute's Library Services Division at (202)326-
8304, and ask for this memo's attachment number: 10301.