Form 1099-INT is used to report interest income paid to individuals. However, a 1099-INT must be provided to the recipient, and a copy mailed or e-filed with the IRS.
A Form 1099-INT, Interest Income, is used to report interest payments made or attributable to you. That’s easy enough – but the amounts and types of interest will impact which tax form you can use.
It’s important to note that you cannot file a form 1040EZ if your taxable interest income is more than $1,500.
Form 1099-INT: Interest Income?
Form 1099-INT is the IRS tax form used to report interest income. The form is issued by all payers of interest income to investors at year end.
It includes a breakdown of all types of interest income and related expenses. Payers must issue a 1099-INT for any party to whom they paid at least $10 of interest during the year.
What Is Form 1099-INT Used For?
IRS Form 1099-INT must be filed for each person:
To whom a financial institution paid amounts reportable in Boxes 1, 3, and 8 of at least $10 (or at least $600 of interest paid in the course of your trade or business described in the instructions for Box 1, “Interest income”).
For whom a financial institution withheld and paid any foreign tax on interest.
From whom a financial institution withheld (and did not refund) any federal income tax under the backup withholding rules regardless of the amount of the payment.1
Interest paid that must be reported on a 1099-INT will include interest on bank deposits, accumulated dividends paid by a life insurance company, indebtedness issued in registered form or of a type offered to the public, or amounts from which federal income tax or foreign tax was withheld.
In addition, interest accrued by a real estate mortgage investment conduit (REMIC) or a financial asset securitization investment trust (FASIT) regular interest holder, or paid to a collateralized debt obligation (CDO) holder, will also be reported here.
What Information is on a 1099-INT?
The 1099-INT is a short form as IRS tax forms go. When an entity is require to issue this form, it must provide three copies — one to the IRS, one to the individual receiving the interest, and one to the state tax department.
On the left side of the Form 1099-INT are boxes for …
The name, address and taxpayer identification number, or TIN, of the entity that made the interest payment
The name, address and TIN of the individual who received the interest payment
An account number used to distinguish the recipient’s account
Numbered boxes appear on the right side of the form.
Box-by-box, here’s the information they include
Box 1: Interest income of $10 or more, in most cases (but the reporting threshold is $600 or more for certain types of payments, like interest on delayed death benefits from a life insurance company)
Box 2: Early-withdrawal penalty (if any) — for example, if you withdrew money from a CD before its maturity date and paid a penalty for doing so
Interest on U.S. Savings Bonds and Treasury obligations at Box 3
Federal income tax withheld (if any) at Box 4
Box 5: Investment expenses
Box 6: Foreign tax paid
Also, Foreign country or U.S. possession that foreign tax was paid to at Box 7
Box 8: Tax-exempt interest
Specified private activity bond interest at Box 9
Market discount Box 10
Box 11 Bond premium
Bond premium on Treasury obligations at Box 12
Bond premium on tax-exempt bond at Box 13
Tax-exempt and tax credit bond CUSIP number at Box 14
Box 15: State
Box 16: State identification number
Also, State tax withheld (if any) at Box 17
In some cases, your 1099-INT may be part of a composite 1099 statement from a broker. If you receive interest income from more than one financial institution, you should receive more than one Form 1099-INT.
If You Don’t Receive a 1099
It’s entirely possible to misplace a Form 1099 before you sit down to prepare your taxes. In some cases, the business that paid you might have failed to send you the form.
Reach out to the business first to see if you can get a replacement Form 1099. The same applies if you receive a 1099 but you think the information is wrong. Ask for an amended form.
You can contact the IRS at 1-800-829-1040 if you can’t get the situation straighten out with the payer, or visit an IRS Taxpayer Assistance Center.
You can submit IRS Form 4852, instead if you’re missing a Form 1099-R.
Also, knowing which Form 1099 applies to income you’ve earned and your financial situation, and reporting each correctly to the IRS, can make your life that much easier.
1. What is a 1099-INT?
Form 1099-INT is used to report interest income paid to individuals. A 1099-INT must be provided to the recipient, and a copy mailed or e-filed with the IRS.
2. Why do I file 1099-INT?
The IRS requires that all income is reported by businesses and individuals or penalties could apply.
3. Who needs to file 1099-INT?
Any organization which has paid interest income, withheld foreign tax on interest or withheld federal tax under the backup withholding rules must use form 1099-INT. See the official IRS instructions.
Making money from your investments is a good thing, as long as you don’t forget to pay federal income tax on all your taxable interest income.
However, if you receive a 1099-INT, make sure you carefully enter each line into your tax-filing software. Preparing your return accurately can help you avoid paying taxes on income that’s suppose to be tax-free.
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