Tax Facts

787 / How does community property law affect the federal income tax treatment of dividends received from corporate stock?

Updated: November 02, 2024 at 04:03 AM
If state law characterizes the income as community income (see Q 785), the dividends are treated as having been received one-half by each spouse. This rule has been held to apply to dividend income received by a spouse as marital property under the Wisconsin Marital Property Act.1 If the dividends are characterized as separate property and the spouses file separate returns, each spouse reports his or her own separate income.2




1.  Rev. Rul. 87-13, 1987-1 CB 20.

2.  IRS Pub. 555.


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