Accrued Bond Interest

[dick16]

I have a mixture of taxable and tax exempt bonds for which I receive interest income every year. All my accrued interest this year is for tax exempt bonds purchased in 2024. Where and how do I report that in Turbo Tax?

[dev145]

Hello dick16,

When you start working on your 2024 return, follow these steps to report interest on Tax Exempt bonds.   

1. Go to Income and Wages.

2. Click on Investment Income

3. Please do not select import but select "Type if myself"

4. Enter "US Treasury" under bank name.

4. Click on "My form has info. in more than just box 1"

5. Enter interest on box 8 "Tax Exempt Interest".

Please note, these steps are based on 2023 TurboTax online. 

Thanks for participating in TurboTax's Ask the Expert event today. I hope this information was helpful!

**Please cheer or say thanks by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

Regards,
TurboTax Expert

[Terri Lynn]

Hello, Dick16!

In general, when you receive tax-exempt interest from investments like municipal bonds, you will receive a Form 1099-INT or Form 1099-OID.  On Form 1099-INT, your tax-exempt stated interest will usually be shown in box 8.

In TurboTax, follow these steps:

1. Click into the Wages & Income section.
2. You may need to click on see all income.
3. Scroll down to Interest and Dividends.
4. Click on Show more and then Interest on 1099-INT.
5. Then click on Start or Update.
6. Then, under the field that you input your interest income there is a box you can check that says, my form has info in more boxes. Once you check this box, more boxes from the 1099-INT will appear, including Tax Exempt Interest.

For more information see:

• Filing Tax Form 1099-INT: Interest Income 
• Where do I enter 1099 OID? 

Please feel free to reach back out with any additional questions or concerns you might have!

Have an amazing rest of your day!

 *Please say "Thanks," by clicking the thumbs up icon at the bottom of the post.
**Select the post that answers your question by clicking on "Mark as Best Answer.”