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Hi no I don't think you'll get anywhere with the brokerage firm changing the 1099, I am referring to changing how the 1099 is input into TT and reported on your return (see below), to move the agency interest from Box 1 to Box 3 in TT.

 

And re "input a separate 1099-INT for it" I just mean a 1099 which has nothing in Box 1 and the agency interest in Box 3.  If you already have Treasuries in Box 3 that can go together.  But you only really need to do this if you have accrued interest adjustment, it's not needed to resolve the issue you are having.  In general, splitting up 1099s in TT is fine it doesn't have to match how the broker presents it consolidated on one form.

 

As for moving things from Box 1 to Box 3, yes it will differ from the 1099, but it won't affect your Fed taxes.

 

If you look at a PDF of your return needed for filing which is the end goal - none of this 1099 box detail is sent to the IRS when you file, all this data entry into TT is just mechanics to generate and support your final return - everything from Box 1 and Box 3 gets consolidated on Schedule B, only payer name and total interest amount is in your return (with premium or accrued interest adjustments consolidated on a separate line).  Box 8 is reported separately as tax exempt interest.

 

Instructions for Schedule B Line 1 - "Report on line 1 all of your taxable interest. Taxable interest generally should be shown on your Forms 1099-INT, Forms 1099-OID, or substitute statements... List each payer’s name and the amount. Don't report on line 1 any tax-exempt interest."

https://www.irs.gov/pub/irs-pdf/i1040sb.pdf