Joint account 1099-INT

[AmyC]

• The IRS will gladly let you file for the interest now. 
• You definitely want to change the information at the bank.
• Mom's return, 
  • File an amended return and show the nominee interest
    • To show nominee interest using Turbo Tax, enter the 1099-INT
    • Next screen, Do Any of These Uncommon situations Apply?
    • Select I need to adjust the interest reported on my form
    • Continue
    • Tell Us about Your Interest Adjustment
    • Enter $10
    • Reasons for adjustment
    • Select top choice - I received all or part of this interest for someone else (I am a nominee)
    • Continue

[ranbre102]

Thank you so much @AmyC !

While doing the steps below we noticed that there's no place for my mom to enter my SSN/Name while doing this:  I received all or part of this interest for someone else (I am a nominee). Wouldn't we have to do that in order for them to expect the full $10 on my return?

[JohnW222]

You're correct, there's no place to enter the nominee's information.  It's not required here.

[jtax · Accepted solution]

amy, can you cite authority for the $25 rule? 

As other's have said and you worked through the 1099-INT needs to be on your mother's return but really belongs on yours. The "right" thing to do is the nominee process, but for such a small amount it really won't matter although technically it isn't right.

I'd recommend you take you mother's name off the account so 1) to avoid this situation next year and 2) to not have the assets in the account available to her creditors and 3) (a few other reasons).  In general joint accounts are not a good idea. Much better to have title in the true owner's name/SSN and to use give a power of attorney if someone else needs to manage the account. Use a pay-on-death designation to estate planning purposes (rather than joint ownership) to avoid probate.

[ranbre102]

Thanks @jtax and @JohnW222 . I will be closing that account to avoid future situations like this in the future.   

Should I proceed with adding this 1099-INT on my return and have my mom do the nominee process as described above (although there would be no way for her to reflect that this is on my return) given its my income or have her put the 1099 on hers alone, although it wont really change her tax for such a minimal amount I just want to make sure i'm following the correct process on this. 

[DaveF1006]

I would suggest putting this on your tax return and not have your mother do the nominee process. This way the income is reported and you have done your due diligence, especially reporting this small amount of interest income..