1099-INT interview - accrued interest paid

[Mitzy20]

I entered the accrued interest paid in the 1099-INT interview - as a positive number based on TT instructions (tho it should reduce interest income). Where do I see the dollar amount I entered?  It does not appear as a line item on Schedule B.

[SteamTrain]

@Mitzy20 

It depends on what other boxes that the interest income is listed on.

If that 1099-INT contains box 8 (&box 13) $$, but neither box 1 nor box 3 $$, then the accrued interest you paid when buying that tax-exempt bond, it can only be seen in the total value showing on line 2a of your form 1040.....the sum of all your tax-exempt $$ minus that accrued interest.

IF box 1 or box 3 $$ are involved with that accrued interest, then the deduction should show up in the Schedule B, PART I , Line 1 table.

___________________

note also, that any time you do pay accrued interest for any bonds you buy during the year, then, in the TTX software...you must break out the bond interest type into it's own 1099-INT before declaring the accrued interest you paid when buying that bond type.

But that may be what you are already doing.

[Mitzy20]

I found the accrued interest amount as a line item, on the Schedule B after I posted my question. It was subtracted from the total interest amount which is what I expected. The 1099-INT shows an amount in Box 1, a bond premium in Box 11, but all other boxes are empty.   
Can you further explain your comment (below):
:

"note also, that any time you do pay accrued interest for any bonds you buy during the year, then, in the TTX software...you must break out the bond interest type into it's own 1099-INT before declaring the accrued interest you paid when buying that bond type"

How would I break the "bond interest type into it's own 1099-INT"? 
Not sure why I would have to do this or how I would do it?
Note the bond was not purchased in 2025. Box 11 shows the amoritized bond premium for 2025.
Thanks

[SteamTrain · Accepted solution]

@Mitzy20 

Explanation about:

"note also, that any time you do pay accrued interest for any bonds you buy during the year, then, in the TTX software...you must break out the bond interest type into it's own 1099-INT before declaring the accrued interest you paid when buying that bond type"

_____________________

Many folks with 1099-INT forms, they get those forms with a mix of $$ in boxes 1, 3, an 8 $$ in them, and perhaps along with their respective box 11,12,and 13 premium amortization amounts.

When indicating the accrued interest paid on the follow-up page...you may have noticed that the entry didn't specify whether that accrued interest amount was to be applied to the box 1, or 3 or 8 $$.   What TTX software does in this case, is to improperly apportion the accrued interest $$ amount among the box 1, 3 and 8 amounts.    That didn't happen to you since you only had a box 1 (& 11) set of values.

In the future, if you buy any Muni bonds from the same brokerage...they will start issuing a 1099-INT with box 1 (&11) and box 8 (&13) $$ on them.....so at that time you would need separate out the box 8 (&13) $$ to create a separate 1099-INT with ONLY the box 8 (&13) $$ on it before reporting any accrued interest for that Muni bond you bought.....otherwise, some of the accrued interest will be applied to the box 1 $$.

________________

Other:  True, you might have bought your bond in 2024.  Yep, you aren't allowed to declare the accrued interest you paid out until the year in which you actually get your own first interest/dividend payment from that bond.  That can happen for bonds bought in the last 6 months of the year.  Some will still have an interest payment in the same year....some won't happen until the next year.

[Mitzy20]

TurboTax needs to fix this. Can someone please report it.

[DianeW777]

We at Intuit TurboTax want our users to be completely delighted with their experience using our products and services, and successful in their financial lives and businesses.

Once you file your return, as long as the settings to receive communication from Intuit don’t block it, you will see a pop-up message or receive an email with a survey asking you about your experience. We encourage you to leave your notes and comments there. “Voice of the Customer” notes and comments are read and acted upon. 

If you are using TurboTax Desktop, you can also leave feedback at the Final Steps tab.

@Mitzy20