Enter accrued interest
Do the following if you received a Form 1099 for interest as a purchaser of a bond with accrued interest:
- Go to theIncomefolder and select either theB&Dscreen or theBrokerscreen. Only use theBrokerscreen if you want to enter a consolidated 1099.
- Open theInterest incomestatement window.
- Create a new line item and complete the following columns:
- FS: If the interest is federal-only or state-only, code it as federal or state. Leave this field blank if you need to report the interest on both federal and state levels.
- TSJ: Code the interest to the Taxpayer, the Spouse, or as Joint. If you're here from theBrokerscreen, this field doesn't exist because the coding for the Taxpayer, Spouse, or Joint is inherent to the entireBrokerscreen. Consequently, theInterest Incomestatement automatically picks up the code from there.
- Payer:Enter the payer name.
- Interest income:Enter the total taxable interest income. Don’t include any adjustments for accrued interest or any tax-exempt amounts.
- Create another line item and enter the following:
- For theFS,TSJ, andPayerfields, repeat the data entry from the previous step.
- Type Code: Enter4 - Accrued Interest.
- Interest income: Enter the accrued interest as a positive amount.
