1096? Co-Owner of Savings Account

[GPTX]

My wife (we file "Married filing jointly") is co-owner (not co-signer) with her mother on her mother's bank savings account.  Her mother received a 1099-INT from that account.  I understand that as a co-owner her mother should issue a 1099-INT to my wife for half of the interest reported on the original 1099-INT from the bank.  I have also heard that her mother needs to file a 1096 showing that she issued a 1099-INT to my wife.

For Tax Year 2024, we have already filed our return.  Her mother has not yet.  Where do we find the 1096 form in TurboTax Deluxe desktop (this version is used for both returns) to create the 1096 and the 1099-INT?   

Can her mother file electronically, or does she need to file via paper?

Same questions for Tax Year 2023.  Both returns (ours and her Mother) have been filed by the April 2024 deadline.  We will need to have amended returns for both of us - do these amended returns need to be paper?  Where do we find the 2023 1096 form?  Where do we find the 2023 1099-INT form?

Thanks in advance for any help.

[DianeW777 · Accepted solution]

Yes, her mother can file using e-file and does not need to paper file. The information below will explain how to issue a 1099-INT and 1096 to the IRS to assign part of the interest to your wife. 

How do I amend my federal tax return for this year?

How do I amend a tax return for a prior year?

Nominee Returns.  This is how the IRS knows what you are doing. This will be done by mail and not through your tax return or e-file.

Generally, if you receive a Form 1099 for amounts that actually belong to another person or entity, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received).  You must also furnish a Form 1099 to each of the other owners. 

File the new Form 1099 with Form 1096 (this is a transmittal for the 1099) by mailing to the Internal Revenue Service Center for your area. (Provided on the Form 1096)

• On each new Form 1099, list mother as the payer and the other owner, as the recipient. On Form 1096, list your mother as the nominee filer, not the original payer.  The nominee is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner.

The forms filed with the IRS should be the red copy so if you don't have a color printer, go to the IRS website and order the forms here: 

• Form 1096
• Form 1096 - 2023
• Form 1099-INT (can be used for both 2023 and 2024)