Thanks @SteamTrain. Makes sense. I'm wondering if anybody has found a reference from the IRS or an accounting firm verifying your key points:
1) Accrued interest paid at the time of bond purchase can offset interest earned only on the same security.
2) Accrued interest paid can only offset interest earned in the year interest is earned on that same security. In other words, if a bond was purchased in 2023 with accrued interest paid and the first interest payment on that bond is not until 2024, then the accrued interest paid can be used to offset interest received on the 2024 return, not the 2023 return.
Federal Schedule B instructions are of no help based on an "accrued" word search.
