Quick Answer
Form 1099-INT has 13 boxes, but most taxpayers only need to focus on Box 1 (taxable interest) and Box 3 (interest on U.S. Savings Bonds). Box 1 goes directly on your tax return as income. In 2025, the average 1099-INT reported $247 in interest income per taxpayer.
Best Answer
Diana Flores, Tax Credits & Amendments Specialist
Perfect for anyone who received a 1099-INT from their bank or credit union
What is Form 1099-INT and why did you receive it?
Form 1099-INT reports interest income you earned during the tax year from banks, credit unions, savings accounts, CDs, and bonds. You'll receive one from each institution that paid you $10 or more in interest during the year.
The most important boxes on your 1099-INT
Box 1: Interest Income — This is your main concern. It shows the total taxable interest you earned, which gets reported directly on your tax return. This includes interest from:
Box 3: Interest on U.S. Savings Bonds and Treasury Obligations — Interest from Series EE, Series I savings bonds, and Treasury bills/notes. This may be tax-free at the state level depending on your state.
Box 4: Federal Income Tax Withheld — Rare, but if backup withholding was applied (usually because you didn't provide your SSN), this amount was already sent to the IRS as a credit toward your tax bill.
Example: Reading your 1099-INT
Let's say you received this 1099-INT from your bank:
What this means for your taxes:
Understanding the other boxes
Red flags that need attention
Missing 1099-INTs: Banks must send you a 1099-INT if you earned $10+ in interest, but you must report ALL interest income, even amounts under $10. Check all your accounts.
Box 2 early withdrawal penalties: If you cashed out a CD early, the penalty in Box 2 is deductible dollar-for-dollar against your income — don't miss this deduction.
Box 8 tax-exempt interest: While federally tax-free, this interest may still be taxable in some states and could affect your eligibility for certain credits or deductions.
What you should do
1. Match your records: Compare the 1099-INT amounts to your bank statements to ensure accuracy
2. Report all interest: Even if you don't receive a 1099-INT, report all interest income over $10
3. Check for deductions: If Box 2 shows early withdrawal penalties, claim this deduction
4. Consider tax-exempt alternatives: If you're in a high tax bracket, municipal bonds (Box 8 income) might save you money
Use our Form Explainer tool to upload your 1099-INT and get a personalized breakdown of what each number means for your specific tax situation.
Key takeaway: Focus on Box 1 (taxable interest) and Box 3 (savings bond interest) — together, these determine how much additional income you'll report. Most taxpayers with under $1,500 total interest can report it directly on Form 1040 without filing Schedule B.
Key Takeaway: Box 1 and Box 3 contain your taxable interest income that must be reported on your return, while Box 2 early withdrawal penalties are deductible.
Key boxes on Form 1099-INT and what they mean for your taxes
| Box | What It Reports | Tax Impact | Action Required |
|---|---|---|---|
| Box 1 | Taxable interest income | Added to taxable income | Report on Form 1040 |
| Box 2 | Early withdrawal penalty | Tax deductible | Claim as above-the-line deduction |
| Box 3 | U.S. Savings Bond interest | Federally taxable, may be state tax-free | Report on Form 1040 |
| Box 8 | Tax-exempt interest | Not federally taxable | Report for informational purposes |
More Perspectives
Diana Flores, Tax Credits & Amendments Specialist
Best for people with basic savings accounts who just need the essentials
The simple approach to reading your 1099-INT
If you have a basic savings account or CD, your 1099-INT is straightforward. You only need to worry about two things:
Box 1: Interest Income — This is the money your bank paid you in interest. It goes on your tax return as income, just like wages from a job.
Box 2: Early withdrawal penalty — Only applies if you cashed out a CD before it matured. Good news: this penalty is tax-deductible.
Simple example
Your 1099-INT shows:
What to do: Report $156 as interest income on your Form 1040. If you're in the 12% tax bracket, this adds about $19 to your tax bill.
Don't overthink the other boxes
Most simple filers can ignore Boxes 3-13. These apply to more complex investments like Treasury bonds, foreign accounts, or tax-exempt municipal bonds. If these boxes have amounts, consider upgrading to tax software or consulting a preparer.
Quick filing tip
If your total interest income from all sources is under $1,500, you can report it directly on Form 1040 Line 2b. No need for Schedule B (Interest and Ordinary Dividends).
Key takeaway: For basic savers, just add Box 1 to your income and deduct any amount in Box 2 — that's it.
Key Takeaway: Simple filers only need Box 1 (add to income) and Box 2 (deduct if present) — ignore the rest unless amounts are significant.
Sources
- IRS Instructions for Form 1099-INT — Official instructions for recipients and payers of Form 1099-INT
- IRS Publication 550 — Investment Income and Expenses
Related Questions
Reviewed by Diana Flores, Tax Credits & Amendments Specialist on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.