You would report this as interest earned.
- Go to: Federal > Wages & Income.
- Locate: Investments and Savings (1099-B, 1099-INT, 1099-DIV, 1099-K, Crypto).
- Action: Click Start or Add/Edit.
- Click Add investments then select Interest from the options. When asked how to upload, choose "Type it in myself."
- Received from: Enter the name of the foreign bank.
- Payer's ID (EIN): Leave this blank. The software may flag it as "Needs Review" later, but the IRS allows e-filing for foreign interest without an EIN.
- Box 1 (Taxable Interest): Enter the U.S. dollar equivalent of the interest you earned.
If your interest is over $1,500, TurboTax will automatically generate Schedule B. This is where you must disclose the foreign nature of the account.
- Part III (Foreign Accounts): After entering your interest, TurboTax will ask if you have a financial interest in a foreign country. You must answer YES.
- Country Code: You will be prompted to select the country where the account is held.
- Failure to answer these questions correctly can trigger significant penalties, even if the tax amount is small.
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