Need to show interest less than $1?

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ketanco
Posts: 136
Joined: Wed Jul 24, 2013 7:09 pm

Need to show interest less than $1?

Post by ketanco » Wed Mar 11, 2020 12:09 pm

I received a 9 cents interest from my broker and they issued a 1099 INT. They say this is issued as they issued my other 1099 s too otherwise below $10 they don't do it....
In the tax software I use, I entered this 9 cents but it rounds down to zero dollars and doesn't show it. It only shows it if I enter a dollar. So I cannot show this in my tax return. Is it ok? If not what can I do?

rkhusky
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Re: Need to show interest less than $1?

Post by rkhusky » Wed Mar 11, 2020 12:11 pm

Don't worry about it if you round everything else to nearest dollar and don't have any other interest.
Last edited by rkhusky on Wed Mar 11, 2020 12:12 pm, edited 1 time in total.

Silk McCue
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Re: Need to show interest less than $1?

Post by Silk McCue » Wed Mar 11, 2020 12:11 pm

All numbers entered are rounded up or down on the tax return. That's just the way it works, for you sometimes and against you at others. You don't need to worry about these 9 cents.

You can rest easy.

Cheers

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BolderBoy
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Re: Need to show interest less than $1?

Post by BolderBoy » Wed Mar 11, 2020 5:11 pm

Silk McCue wrote:
Wed Mar 11, 2020 12:11 pm
All numbers entered are rounded up or down on the tax return. That's just the way it works, for you sometimes and against you at others.
I noticed this with the H&RBlock software last year. However the tax refund from the fed was to the exact penny. So what the software displays and what it sends to the fed apparently aren't the same.
"Never underestimate one's capacity to overestimate one's abilities" - The Dunning-Kruger Effect

Silk McCue
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Re: Need to show interest less than $1?

Post by Silk McCue » Wed Mar 11, 2020 5:13 pm

BolderBoy wrote:
Wed Mar 11, 2020 5:11 pm
Silk McCue wrote:
Wed Mar 11, 2020 12:11 pm
All numbers entered are rounded up or down on the tax return. That's just the way it works, for you sometimes and against you at others.
I noticed this with the H&RBlock software last year. However the tax refund from the fed was to the exact penny. So what the software displays and what it sends to the fed apparently aren't the same.
I don’t follow. The presence or absence of 9c of income isn’t going to change the refund. The tax software doesn’t hold the “shadow” value.

Cheers

DIFAR31
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Re: Need to show interest less than $1?

Post by DIFAR31 » Wed Mar 11, 2020 5:30 pm

According to the IRS, numbers should only be rounded when coming up with the final value to enter on a schedule or tax form line. In other words, if you have a bunch of different bank accounts that pay taxable interest and each account paid less than $.50 for the tax year but the total added up to $.50 or more, you would have an amount greater than $0 to enter on line 2b of Form 1040.

You can round off cents to whole dollars on your return and schedules. If you do round to whole dollars, you must round all amounts. To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1 and $2.50 becomes $3. If you have to add two or more amounts to figure the amount to enter on a line, include cents when adding the amounts and round off only the total.

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

Topic Author
ketanco
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Joined: Wed Jul 24, 2013 7:09 pm

Re: Need to show interest less than $1?

Post by ketanco » Wed Mar 11, 2020 5:39 pm

It is not the 9 cents or not 9 cents. There is a 1099 int from the broker. But I cannot show this altogether because when the software rounds it down to zero, that entry cannot even be made. So it is not even going to be shown as zero. It will not exist... So for something which has a 1099int, i cannot show. I called the broker and they said they issued 1099 int for my viewing only, in the consolidated tax form just because they also issued me 1099div and 1099b. They said rhey do not send this 1099int to irs as it is below $10. But even if they sent it, it is not an issue then, so i will just efile with the software

sport
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Location: Cleveland, OH

Re: Need to show interest less than $1?

Post by sport » Wed Mar 11, 2020 5:44 pm

You do not need to show any line item 49 cents or less, if all other line items are rounded to the nearest dollar.

mega317
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Re: Need to show interest less than $1?

Post by mega317 » Wed Mar 11, 2020 6:03 pm

ketanco wrote:
Wed Mar 11, 2020 5:39 pm
because when the software rounds it down to zero, that entry cannot even be made. So it is not even going to be shown as zero. It will not exist...
Yes this is a common (universal maybe) problem with tax software. And it goes both ways. If you have 2 1099s of 50 cents each, the software will round each up to a dollar and you'll have a 2 on your 1040, when if you did the math yourself it would be a 1.

I've decided that a dollar doesn't matter, and if the IRS asks for taxes plus penalties and interest on the additional dollar because I rounded wrong, I'm happy to pay. Or happy to amend a prior year if I can get a dollar the other way :mrgreen:

Another option for you would be to enter a "1" instead of 0.09 if that's what it takes to make the total number accurate.
https://www.bogleheads.org/forum/viewtopic.php?t=6212

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