Not knowing all of the particulars of your inheritance situation ourselves, let's take your estate lawyer at their word. If all you need to do is to report the interest you received as taxable ordinary income, then that's easy enough to do. You will enter it into your tax return just as though you got a standard Form 1099-INT (the IRS-sanctioned tax document typically used to report interest payments), even if you did not.
You can report such interest by performing the following steps in the TurboTax program:
- Open your return in TurboTax.
(To do this, sign in to TurboTax and click the orange Take me to my return button.)
- In the search box, search for 1099-INT (upper- or lower-case, with or without the dash) and then click the "Jump to" link in the search results.
- Answer Yes when asked if you received any interest income.
- If you land on the Here's the interest we have so far screen instead, click Add Interest Income.
- On the next screen, select I'll type it in myself and click Continue.
- Enter the name of your bank or other institution (or the name of the payer, if no bank or institution is involved) in the Received From field and the interest amount in Box 1, then click Continue.
That should take care of it. Please let us know if you encounter any difficulties or need further information.
