On Form 1099-INT, does the reported income on line 3 "Interest on US Savings Bonds and Treas Obligations" net of the accrued % I paid when purchased in the secondary mkt?

[MarilynG1]

See below for where to enter this Box 3 Interest in the TurboTax software

• Log into your account, click orange Take me to my return button
• Type 1099-INT in the Search box in top right
• Select jump to 1099-INT and it will take you right to section to enter this
• Select Yes on page where it asks Did you receive any interest income?
• Next page, choose I'll type it in myself and then put a check mark in the box labeled My form has info in more than just box 1 (this is uncommon) on the next page
• Enter your Savings Bond Interest in Box 3 there

Here's info on How Treasury Bond Interest is Calculated. 

@jeff2468 

[jeff2468]

Thanks, unfortunately does not answer the question. I purchased coupon Treasury bonds in the secondary market and the price included accrued interest because it was between coupon payment. My 1099-INT reports interest I received, does this number include the accrued interest I paid that was returned to me when the coupon was paid which I need to deduct? There is a line on my Fidelity tax statement under "Supplemental Information Not Reported to the IRS" that shows "Accrued Interest Paid on Purchases," do I need to deduct this amount so I am not taxed on it?

[MinhT1 · Accepted solution]

The amount reported in box 3 includes all interest for the full year.

Accrued interest when you purchase the bond mid-year is taxable to the seller. Only the interest from date of purchaser is taxable to you (the buyer). So you should deduct accrued interest you paid from the amount in box 3.

[jeff2468]

Thank you