What Form 1099-INT (2025) Is For
IRS Form 1099-INT (2025) is a tax form used by a financial institution or other entity to report interest income paid to a person during the tax year. This form shows the amount of interest earned from accounts such as savings, certificates of deposit, or government bonds. The information reported helps the Internal Revenue Service track taxable and tax-exempt interest for income tax purposes. Each form is issued to both the taxpayer and the IRS, ensuring all amounts received are correctly recorded and reported on the tax return.
Form 1099-INT includes several boxes that identify the type of income earned. For example, Box 1 reports taxable interest, Box 3 lists interest from U.S. savings bonds, and Box 8 shows tax-exempt interest. This tax form ensures that all payments, whether from a bank, brokerage, or other financial institution, are accurately reflected for the correct tax year.
When You’d Use Form 1099-INT
Form 1099-INT is used when a taxpayer has received $10 or more in interest from a bank or other financial institution during the year. This income is added to the total amount reported on the federal tax return to calculate overall taxable earnings. Even if the form is not received, the taxpayer must still include all interest income on the return.
In some cases, a corrected or late 1099-INT may be issued if errors are found or if a payer updates the reported information. A person who receives a corrected form and finds that the change affects the tax owed must file an amended tax return. It is important to remember that every form received from a financial institution or other entity must be retained as proof of income reported.
For complete details on reporting, withholdings, and tax filings, see our guide for Information Returns & Reporting Forms.
Key Rules or Details for 2025
During the 2025 tax year, all taxable and tax-exempt interest must be included on the federal income tax return. If the total taxable interest exceeds $1,500, Schedule B must also be attached. The IRS requires that all payers who issue ten or more information returns file electronically through the approved system.
The deadline for financial institutions to send Form 1099-INT copies to recipients is February 2, 2026. Paper filings are due to the IRS by March 2, 2026, and electronic filings by March 31, 2026. In every case, taxpayers must review all forms received for accuracy, confirm the amounts paid, and report them correctly on the corresponding line of the tax return to avoid penalties or delays in refunds.
Step-by-Step (High Level)
The following steps outline how to use Form 1099-INT effectively during the filing process.
- Collect all Forms 1099-INT issued by banks, credit unions, or other financial institutions that paid interest.
- Review each form carefully for accuracy, ensuring that names, addresses, and identification numbers are correct.
- Confirm that the interest amounts match personal or business account records.
- Separate taxable interest, tax-exempt interest, and early withdrawal penalties as indicated on the form.
- Report taxable interest on the federal tax return using Form 1040 or Schedule B, depending on the total amount.
- Deduct any early withdrawal penalties where applicable on Schedule 1 (Form 1040).
- Retain copies of all forms with tax records for at least three years.
- Make estimated tax payments if substantial interest income is expected to avoid underpayment penalties.
Common Mistakes and How to Avoid Them
Many taxpayers make minor but costly errors when reporting interest income. Understanding and addressing these issues helps ensure accurate filing and compliance with IRS requirements.
- Failing to report interest under $10 when no Form 1099-INT is issued: Report all interest income using bank and brokerage statements, even if you do not receive a form.
- Omitting tax-exempt interest: Report tax-exempt interest on the return for informational purposes, even though it is not federally taxable.
- Misreporting nominee interest: Report the full interest received and issue a Form 1099-INT to the actual owner for their share when required.
- Overlooking early withdrawal penalties in Box 2: Enter the penalty as an adjustment on Schedule 1 to claim the deduction when eligible.
- Ignoring foreign tax paid or missing forms due to outdated addresses: Report Box 6 foreign tax as a potential credit or deduction, and keep your address updated with institutions so all forms arrive on time.
Learn more about how to avoid business tax problems in our guide on How to File and Avoid Penalties.
What Happens After You File
After the tax return is submitted, the IRS automatically compares the amounts reported on each Form 1099 INT with the income declared by the taxpayer. If the figures match, the return process is typically finalized, and any refund or balance due is settled. If there are differences, the IRS may send a notice requesting clarification or an updated return.
Interest income is considered taxable and is included in total revenue for federal purposes. Unlike retirement plan distributions, it is not subject to Social Security or Medicare taxes. Any tax withheld, as shown in the appropriate box, is credited toward the total tax liability. Taxpayers should always keep a copy of each form received to verify the information reported and support future filings if updates are required.
FAQs
Do small amounts of interest under $10 need to be reported?
All taxable interest income must be reported, even if the amount is less than $10. The $10 threshold only determines whether the payer is required to issue a Form 1099-INT.
What should be done if a corrected Form 1099-INT is received after filing?
If the corrected form changes the total interest income or affects the tax liability, an amended return should be filed using Form 1040-X.
Is interest from U.S. savings bonds taxable?
Interest from Series EE or Series I savings bonds is subject to federal income tax but is exempt from state and local taxes. Specific education-related exclusions may apply.
What is the difference between Box 1 and Box 3 interest?
Box 1 reports taxable interest from banks and other financial institutions, while Box 3 reports interest from U.S. Treasury obligations and savings bonds, which are exempt from state and local income taxes.
Can investment expenses in Box 5 be deducted for tax purposes?
Investment expenses in Box 5 are generally not deductible for individuals due to tax law changes.
Are Social Security and Medicare taxes applied to interest income?
Interest income is not subject to Social Security or Medicare taxes. It is only subject to federal and possibly state income taxes.
What should be done if the form lists another person’s information?
Contact the issuer immediately to request a corrected form. If the interest belongs to another individual, a separate Form 1099-INT must be issued to that person.
For more resources on filing or understanding prior-year IRS forms, visit our Form Summaries and Guides Library or see our IRS assistance guide.
