Form 1099DIV Dividends and Distributions
Box 1b Qualified dividends
 Ordinary dividends (Box 1a) are taxed at ordinary income rates, while Qualified dividends are taxed at (lower) capital gains rates.
Box 3 Nondividend distributions
 Nondividend distributions are a return of basis, and are not taxed until all cost is recovered. The taxpayer is responsible to keep track of these distributions and must reduce the investment cost ('basis') by these distributions at the time of sale. Once all costs are recovered, these distirbutions must be reported as capital gain.
Box 8 Cash liquidation distributions and Box 9 Noncash liquidation distributions
 Liquidating distributions are received during a partial or complete liquidation of a corporation. The taxpayer is responsible to keep track of these distributions and must reduce the investment cost ('basis') by these distributions at the time of sale. Once all costs are recovered, these distirbutions must be reported as capital gain.

