Form 1099-INT: Interest Income 2024 – A Complete Guide
If you earned interest on your savings account, bonds, or certificates of deposit in 2024, you'll likely receive Form 1099-INT. This tax document tracks interest income you must report to the IRS. While the form itself comes from your bank or financial institution, understanding what it means and how to use it can save you headaches during tax season.
What Form 1099-INT Is For
Form 1099-INT reports interest income you earned during the tax year. Financial institutions—banks, credit unions, brokerages, and others—use this form to tell both you and the IRS how much taxable interest you received. Think of it as a receipt for the interest your money earned while sitting in various accounts.
The form captures several types of interest income:
- Regular interest from savings and checking accounts
- Interest from certificates of deposit (CDs)
- Interest on U.S. Treasury obligations like Treasury bills and bonds
- Tax-exempt interest from certain municipal bonds
If you earned $10 or more in interest from a single source during 2024, you should receive a 1099-INT from that institution by January 31, 2025.
The form contains multiple boxes, but the most important for most taxpayers are:
- Box 1: Regular taxable interest
- Box 3: Interest on U.S. Savings Bonds and Treasury obligations
- Box 8: Tax-exempt interest
Understanding these distinctions helps you report your income correctly on your tax return.
Source: IRS.gov
When You’d Use Form 1099-INT (Filing Late or Filing an Amended Return)
You’ll use Form 1099-INT when preparing your annual tax return, typically filed by April 15th. However, life happens, and sometimes you need to address interest income issues after the normal filing period.
Filing Late
If you haven't filed your 2024 tax return yet and it's past the April deadline, you still need to report all your 1099-INT forms when you do file. The IRS already has copies of these forms, so omitting this information will likely trigger a notice. Late filers should gather all their 1099-INT forms and include them on their tax return or Schedule B, just as they would have during the regular filing season.
Amended Returns
Sometimes you discover an error after filing. Perhaps you received a corrected 1099-INT form (marked “CORRECTED”) after already filing your return, or maybe you simply forgot to include interest income from one account. In these situations, you'll need to file Form 1040-X (Amended U.S. Individual Income Tax Return). Include the correct interest income amounts from all your 1099-INT forms with your amended return.
The IRS recommends waiting until you've received your original refund or your original return has been fully processed before filing an amendment.
Source: IRS.gov
If you haven't received a 1099-INT you believe you should have by mid-February, contact the financial institution first. If they can't resolve the issue in time for your filing, you must still report the interest income you know you earned, even without the form.
Key Rules for 2024
Several important rules govern Form 1099-INT for tax year 2024, and understanding them helps you stay compliant.
The $10 Threshold
Financial institutions must issue a 1099-INT if they paid you at least $10 in interest during 2024. This threshold applies to each institution separately. Even if you earn less than $10, you’re still required to report that income.
The $1,500 Schedule B Rule
If your total taxable interest (and ordinary dividends) exceeds $1,500 for the year, you must complete and attach Schedule B (Interest and Ordinary Dividends) to your Form 1040.
Source: IRS.gov
Electronic Filing Requirements
Starting with tax year 2023, if a financial institution issues 10 or more information returns (including 1099-INT forms), they must file electronically. You’ll likely be able to access your 1099-INT online through your bank’s website.
Backup Withholding
If you didn’t provide your correct SSN or TIN to your bank, or if you’ve been notified by the IRS about underreporting, the institution may have withheld 24% federal income tax from your interest payments (Box 4). This counts as a credit toward your tax liability.
Tax-Exempt Interest
Interest shown in Box 8 from municipal bonds is generally exempt from federal income tax but may be taxable at the state level. Even though it’s not taxable, you must still report it—it can affect other tax calculations such as Social Security benefit taxation.
Source: IRS.gov
Step-by-Step: How to Handle Your 1099-INT (High Level)
Processing your Form 1099-INT correctly involves a straightforward series of steps:
Step 1: Gather All Forms
By early February, collect every 1099-INT you receive. Check both mailed and online accounts.
Step 2: Verify Accuracy
Confirm your name, SSN, and interest amounts are correct. Contact the institution if there’s an error.
Step 3: Calculate Your Total
Add up all taxable interest from Box 1 and Box 3 for your total taxable interest income.
Step 4: Determine Which Form You Need
If total taxable interest is $1,500 or less, report it directly on Form 1040, line 2b. If more, use Schedule B.
Step 5: Complete the Appropriate Form
List each payer’s name and amount on Schedule B, then transfer the total to your Form 1040. Include any backup withholding (Box 4).
Step 6: Don’t Forget Tax-Exempt Interest
Report Box 8 totals on Form 1040, line 2a.
Step 7: Keep Your Records
Store your 1099-INT forms with your tax return for at least three years.
Common Mistakes and How to Avoid Them
Tax forms invite errors, but knowing the common pitfalls helps you avoid them.
Mistake 1: Not Reporting Small Amounts
Even if you didn’t receive a 1099-INT, all interest income is taxable and reportable.
Mistake 2: Confusing Box 1 and Box 3
Report these separately—each has distinct tax treatment.
Mistake 3: Forgetting About Joint Accounts
Joint account holders must each report their share of the interest.
Source: IRS.gov
Mistake 4: Ignoring Tax-Exempt Interest
Report Box 8 even though it’s not taxable—it affects other tax calculations.
Mistake 5: Math Errors
Double-check totals or use tax software to avoid simple addition mistakes.
Mistake 6: Using the Wrong SSN
Ensure your SSN or TIN matches exactly with your records to prevent IRS processing delays.
Mistake 7: Overlooking Corrected Forms
If you receive a corrected 1099-INT, file an amended return if it changes your tax liability.
What Happens After You File
Once you’ve filed your tax return with your 1099-INT information included, here’s what happens next:
IRS Matching Process
The IRS matches your reported information with 1099-INT data from institutions.
Potential IRS Notices
If discrepancies exist, you may receive a CP2000 Notice (Proposed Changes) explaining adjustments.
Refund or Payment
Backup withholding (Box 4) counts as prepayment toward your taxes; otherwise, you might owe more.
State Tax Implications
Most states also tax interest income. Check if your state exempts certain bond interest.
Record Retention
Keep all 1099-INT records for at least three years in case of an IRS audit.
FAQs
Q1: I didn’t receive a 1099-INT, but I know I earned interest. Do I still need to report it?
Yes. All interest income is taxable and must be reported, regardless of whether you received the form.
Q2: What if I receive a 1099-INT after I’ve already filed my tax return?
If you missed reporting the interest, file an amended return using Form 1040-X.
Source: IRS.gov
Q3: Do I pay tax on interest earned in retirement accounts like IRAs?
No. Interest earned within IRAs or 401(k)s is tax-deferred or tax-free until withdrawal.
Q4: My 1099-INT shows backup withholding in Box 4. What does this mean?
It means your institution withheld 24% of your interest income for taxes. Report it as a credit on your Form 1040.
Q5: Can I deduct the early withdrawal penalty shown in Box 2?
Yes. Report it on Schedule 1 (Form 1040), line 18 as an income adjustment.
Source: IRS.gov
Q6: I have multiple 1099-INT forms from the same bank. Can I combine them?
Yes. You can combine them under one bank name when reporting on Schedule B.
Q7: What’s the difference between interest in Box 1 and Box 3?
Box 1 = regular interest (savings, CDs).
Box 3 = U.S. Savings Bonds and Treasury interest (state-tax-exempt).
Sources
All information in this guide comes from official IRS resources, including:
- IRS.gov/Form1099INT
- Instructions for Forms 1099-INT and 1099-OID
- IRS Topic 403
- Schedule B Instructions
