I have been reporting the increased value of a U.S. Savings Bond-EE inherited from my mother as interest each year since she died. Then I redeemed the bond in 2023 and received a Form 1099-INT from the bank showing the full amount of interest in Box 3. Using the interview screens, this full amount was entered in Box 3 of the Form 1099-INT Worksheet along with the other requested adjustment information. When I reviewed the Schedule B form, under Part 1 Interest, just below a new Subtotal line, there is also now a line entry for "US Savings Bond Interest Previously Reported" with my adjustment amount correctly shown as a subtraction from the subtotal amount. But later, at the Fed Review Smart Check screen, an error message appears saying: "Schedule B 1099-INT ...Type of adjustment checkbox for Savings Bond-EE cannot be previously reported bond interest since the program does not support this kind of adjustment to Special handling interest... But if Schedule B is now showing the correct adjustment reason and calculation, why is the 2023 Premier program Smart Check showing this error message? Please let me know how I can override or resolve this error to complete my return then e-file it. Thanks!
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Let me see what I might do to help. When I complete the interest entry with the steps below I did not receive an error on Federal Review.
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Thank you DianeW777:
Really appreciate your prompt response and yes, when I updated the Savings Bond interest entries as you suggested, Problem Solved - no error in the Federal Review!
As stated in my original post, I had been reporting the increased value of the savings bond inherited from my mother as interest each year since she died. So that is why I checked the ‘This savings bond interest was previously reported’ reason for the adjustment. But now, to avoid the Smart Check error, I will instead check the ‘My accrued interest is included in this Form 1099-INT’ box (defined in the ‘Learn More’ box link as “…part of the interest payment you are reporting actually went to someone else…”).
Perhaps a future Premier program update should simply consider combining (with your reason) or deleting ‘This savings bond interest was previously reported’ as a check-marked adjustment if, as noted in the error message: ‘…the program does not support this kind of adjustment to Special handling interest’.
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