Whoever you bought the bond from, gets a 1099-INT showing the interest paid to them up until the time you bought it. But if the bond you bought doesn't pay it's first interest payment "To You" until the next year...then you cannot report & subtract the accrued interest you paid to the seller until the next year's tax return
1)....say you bought a bond that pays out interest in Feb and Aug....But you bought it in November of 2018...you have to pay the seller the Aug-Nov accrued interest. You won't get any 1099-INT for that particular bond since you get no interest paid..to you...until Feb 2019, at which time you will get a full 6 months interest added to your 2019 1099-INT (and again in August). So you will report the accrued interest you paid to the seller when you prepare your 2019 taxes in 2020.
2) Most bonds pay out interest either semi-annually or monthly, So if one bought a monthly or semi-annual-paying bond in time such that the bond will actually issue a payment "To You" before Dec 31 of the same year...then you can report the accrued interest you paid the seller for that same year's taxes, because you will get a 1099-INT for that interest pay-out that YOU received for that same year.
____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
