Form 1099-INT is the IRS information return that reports interest paid to you during the year, usually by a bank, credit union, brokerage or bond issuer. You should get one if you received interest of $10 or more (the threshold as of October 2026), and you must report all taxable and tax-exempt interest on your return even if you don't get a form.
A 1099-INT usually turns up early in the year and gets filed straight into a drawer. It's worth a closer look, because the boxes tell you which interest is taxed federally, which is taxed by your state and which isn't taxed at all. Here's what the IRS says each part means.
Who sends a 1099-INT, and when you should get one
According to IRS Topic 403, if you received interest or tax-exempt interest of $10 or more, you should receive Copy B of Form 1099-INT or Form 1099-OID. The IRS's About page says payers file it for anyone they paid amounts in boxes 1, 3 and 8 of at least $10, anyone they withheld and paid foreign tax for, and anyone they backup withheld federal tax from, regardless of the amount.
Other interest paid to you by a business, such as interest received with damages or delayed death benefits, is reported on a 1099-INT if it's $600 or more. And tax authorities can pay you interest on a delayed refund, which may also arrive on a 1099-INT.
What the main boxes mean
| Box | What it shows | What it means for you |
|---|---|---|
| Box 1 | Interest income | Taxable interest not included in box 3, such as bank and savings interest |
| Box 2 | Early withdrawal penalty | Interest or principal you forfeited by closing a CD early, which you may be able to deduct |
| Box 3 | Interest on US Savings Bonds and Treasury obligations | Federally taxable, but exempt from state and local income tax |
| Box 4 | Federal income tax withheld | Backup withholding you can claim as tax paid |
| Box 6 | Foreign tax paid | Foreign tax that may qualify for a credit or deduction |
| Box 8 | Tax-exempt interest | Reportable but not taxable at federal level, such as many municipal bonds |
| Boxes 11 to 13 | Bond premium amounts | Amortised premium that can reduce the interest you report |
The box 3 detail that saves state tax
This is the insight I'd want every saver to know. Topic 403 says interest from Treasury bills, notes and bonds is subject to federal income tax but exempt from all state and local income taxes. That's why the 1099-INT puts it in box 3, separate from box 1. If you hold Treasury bills directly or through a brokerage account and live in a state with income tax, make sure that box 3 interest isn't being taxed again on your state return.
Tax-exempt interest still has to be reported
Box 8 interest, from bonds issued by a state, the District of Columbia or a US territory to fund government operations, is reportable but not taxable at federal level. Topic 403 is clear that reporting tax-exempt interest is an information requirement only and doesn't make it taxable. So report it, but don't pay federal tax on it.
Credit union dividends are interest
Here's one that confuses people. Topic 403 says certain distributions called dividends are taxable interest, including dividends on deposits or share accounts in credit unions, cooperative banks, savings and loan associations and mutual savings banks. So your credit union may call it a dividend, but it belongs on your return as interest, not as a dividend.
What to do when your 1099-INT arrives
- Check the payer, your name and your taxpayer identification number.
- Add box 1 and box 3 to your taxable interest, and note box 3 separately for your state return.
- Report box 8 as tax-exempt interest.
- Claim any box 4 backup withholding as tax already paid.
- If box 2 shows an early withdrawal penalty, check whether you can deduct it.
- Keep the form with your records, and look out for corrected forms.
A different form covers unemployment and state refunds, which our guide to the government payments form explains.
Interest that isn't on a 1099-INT
Some interest comes on a different form. Discounted bonds and similar instruments can produce original issue discount (OID), which Topic 403 says may have to be included in income each year even if you receive no payment, and that's reported on Form 1099-OID. US savings bonds have their own timing: you generally don't include interest on Series EE and Series I bonds until they mature or you redeem them, unless you elect to report it yearly.
If a 1099-INT includes interest that belongs to someone else, such as a joint account where you're the nominee, Topic 403 says you may need to issue a 1099-INT to the real owner, unless it's your spouse. And if you earn a lot of interest, you may need to make estimated tax payments on it.
Business owners who pay interest to others, such as on a loan from a friend, may need to file 1099s themselves; my comparison of Form 1099-MISC and 1099-NEC explains the family, and 1099 software makes filing simpler.
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My verdict
A 1099-INT is a short form with one job: telling you, and the IRS, how much interest you earned. Read the boxes rather than just the total. Box 3 Treasury interest can be left off your state return, box 8 is reportable but not taxable, and interest you earned without a form still counts. Report it all and you'll avoid the mismatch letters that catch people out.
Dividends come with a form of their own, and our guide to the dividend form walks through the boxes and what qualified means.
Frequently asked questions
What is a 1099-INT?
An IRS information return reporting interest paid to you during the year, usually by a bank, credit union, brokerage or bond issuer.
Do I get a 1099-INT for less than $10 of interest?
Usually not, as the form is generally issued for $10 or more. But you must still report all taxable and tax-exempt interest, even without a form.
Is box 3 interest taxed by my state?
No. Interest on Treasury bills, notes and bonds is federally taxable but exempt from all state and local income taxes.
Do I pay tax on box 8 interest?
Not at federal level. Box 8 is tax-exempt interest, which you report for information only.
Are credit union dividends reported on a 1099-INT?
Usually, yes. The IRS treats dividends on credit union share accounts and similar deposits as taxable interest.
What if my 1099-INT includes someone else's interest?
You may be a nominee. The IRS says you may need to issue a 1099-INT to the actual owner, unless that owner is your spouse.
