Where and how do I enter accrued interest on purchases of Treasury securities?

[DENISCH]

I believe this amount should be deducted from Treasury income received.

[MonikaK1 · Accepted solution]

If you are reporting Interest income on an instrument like a bond that had accrued interest at the time you purchased, then yes, you would reduce your interest income by the accrued interest at your purchase date.

See this thread for further discussion of this topic.

When you enter the 1099-INT in Wages & Income, under Investments and Savings, and you get to the screen that asks "Do any of these uncommon situations apply?", check the box "I need to adjust the interest reported on my form" and follow the additional prompts to enter the information. Also, read the Learn More link that appears for further information.

See here for more information from the IRS on this topic.

[DENISCH]

Thanks.  The solution appears to work, though if you have more than one category of interest income, you need to split the 1099-INT into separate documents to properly assign the accrued interest adjustment to the appropriate interest category. I hope that both the interest income and the adjustment are recorded on the actual tax forms to be submitted (not just a net interest amount).  Again, thanks for your help with this.

[LindaS5247]

If you want to check your entries, you can view your entire return or just your 1040 form before you e-file:

1. Sign in to your TurboTax account
2. Open or continue your return
3. Select Tax Tools from the menu (if you don't see this, select the menu icon in the upper-left corner)
4. With the Tax Tools menu open, you can then:
   • Preview your entire return: Select Print Center and then Print, save or preview this year's return (you may be asked to register or pay first)
   • View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu

Click here for instructions on how to preview your Form 1040 prior to e-filing.