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Level 3
posted Jan 30, 2025 6:35:55 AM

US Treasury 1099 Bank interest or bonds

I have interest from T bills and I bonds. US Treasury interest. The report from the Treasury Website says 1099-INT. When I enter in TurboTax should I chose "bank interest" or "Stocks, bonds, and ETFs". Treasury interest is tax free in MA so I don't want to mess this up on the Federal form. 

Thanks in advance

Bill

0 4 1672
4 Replies
Expert Alumni
Jan 30, 2025 7:01:24 AM

Please follow these steps to post your 1099-INT.

 

  1. Select Wages & Income
  2. Scroll to Investments and Savings1099-B, 1099-INT, 1099-DIV, Crypto Gain/Loss Report
  3. Select Interest on 1099-INT
  4. Add Investments
  5. Scroll down to [Enter a different way]
  6. Select Interest - Continue
  7. Scroll down. Select [Type it myself]
  8. post your 1099-INT

Level 3
Jan 30, 2025 7:31:28 AM

  1. Select Wages & Income
  2. Scroll to Interest and Dividends 1099-INT
  3. Select Interest on 1099-INT
  4. Add Investments
  5. Scroll down to SKIP IMPORT
  6. Select Interest - Continue
  7. Now i see 5 choices , Bank Interest, Crypto, Dividends, Bonds and Mutual Funds???
  8. I choose "Bank Interest"
  9. and list bank as US Treasury? IS this correct, Im using Deluxe which may be slightly different
  10. Then chose, my state doesnt tax some of this interest box?

Level 15
Jan 30, 2025 8:00:44 AM

You have it right.  If you have the Desktop program it is Skip Import.  (Enter a Different way is  in the Online version).   You pick the Interest box.   Then the amount goes in box 3 not box 1.  You don't have to pick the state.  Box 3 tells it that it is exempt from state.  

 

How did you cash them in?  You might get a 1099 INT from the bank.  I cashed in a lot of bonds in 2022. I got receipts from Wells Fargo. I wasn't expecting to get an actual 1099INT from WF but I did! If you didn't get a 1099 INT you just enter the total interest like a 1099 INT and put the amount in box 3. Yes the interest is taxable for federal but usually not for state.

Expert Alumni
Jan 30, 2025 8:03:16 AM

Yes, you have the desktop software.

As you listed, Line 9 is correct. US Treasury

Line 10 is also correct.

Interest income from Treasury bills, notes and bonds - is exempt from all state and local income taxes.