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Form 1099-INT Filing Requirements: 2025 Compliance Guide 

1099-INT Filing Requirements

When it comes to reporting interest payments, the IRS has its own list of 1099-INT requirements including who must file 1099-INT, when filing is required, penalties, thresholds, and more.

Interest income reporting Form 1099-INT helps the IRS stay aware of interest income paid by banks and other financial institutions to individuals or entities.

Form 1099-INT: Why It Should Matter

Form 1099-INT reports interest payments of $10 or more. It is also applicable for backup withholding and foreign tax on interest.

Accurate filing of 1099-INT is very important. If there are any errors in your 1099-INT reporting, it can damage business reputation and signal a lack of compliance. The IRS uses the information provided in the form (recipient’s name, TIN, and the interest income paid) to match the data provided by the recipient. If there is a mismatch in the data, the IRS will take note of it, and it could trigger notices or penalties.

For institutions reporting under FATCA rules, you need proper documentation and a clear audit trial. If the IRS or foreign tax agencies start an audit process, they will demand clear evidence supporting every FATCA report. If the audit trail is missing any information, it can lead to penalties and even damage your reputation.

Before you start filing your 1099-INT forms, use our TIN Matching to verify the recipient TIN and name to significantly reduce your chances of notices and penalties.

Who Must File 1099-INT & Threshold (As per IRS rules)

The minimum 1099-INT filing threshold is $10 in interest income paid to individuals or entities (business or trusts). The form also requires reporting for businesses that pay $600 or more in interest as part of a trade or business.

So, who must file 1099-INT? Let’s break it down. 1099-INT filing requirements by the IRS mandate the form to be filed by:

  • Banks and credit unions paying interest on deposits, CDs, or savings
  • Brokerages and investment firms paying interest on bonds or mutual funds
  • Financial institutions paying $10+ in interest income
  • Life insurance companies paying interest or dividends
  • Entities that withhold foreign or federal tax on interest payments

1099-INT Exempt recipients

You are not required to file Form 1099-INT for payments made to certain payees, including, but not limited to:

  • Corporations
  • Tax-exempt organization
  • Any individual retirement arrangement (IRA)
  • Archer medical savings account (MSA) & Health savings account (HSA)
  • Medicare Advantage MSA
  • U.S. agencies & states
  • Registered securities or commodities dealer
  • Nominee or custodian
  • Broker
  • Notional principal contract (swap) dealer

1099 INT E-Filing Checklist for 2025

  1. Collect Form W-9 from recipients and validate their TIN and name using Tax1099’s real-time TIN matching service.
  2. Verify the payee’s status. Check whether they are a U.S. citizen or Non-Resident Alien (NRA) via Form 1042-S.
  3. Fill the reportable boxes on 1099-INT, including:
    1. Box 1 for Interest income
    2. Box 2 for Early-withdrawal penalty
    3. Box 3 for Interest on U.S. Savings Bonds & Treasury obligations
    4. Box 6: Foreign tax paid (if applicable)
    5. FATCA filing indicator checkbox
  4. If TIN is missing or invalid, start backup withholding and report the amount withheld in Box 4.

A Box-by-Box Guide On 1099-INT Electronic Filing

Box 1: Interest Income

Include all taxable interest paid during a tax year, including, interest from bank deposits, bonds, insurance dividends, and other taxable interest.

Box 2: Early Withdrawal Penalty

Report any penalty paid due to early withdrawal of funds from a time deposit (like CDs).

Box 3: Interest on U.S. Savings Bonds and Treasury Obligations

Report any interest earned from U.S. Savings Bonds and Treasury obligations.

Box 4: Federal Income Tax Withheld

Report any federal income tax withheld due to backup withholding 1099-INT rules.

Box 5: Investment Expenses

Report investment-related expenses used only by single-class Real Estate Mortgage Investment Conduits (REMIC).

Box 6, 7: Foreign Tax Paid & Country Indicator

Report any foreign tax paid on interest income and the name of the country for which the foreign tax was paid.

Box 8: Tax-Exempt Interest

Report tax-exempt interest, such as interest on municipal bonds issued by state or local governments.

Box 9: Specified Private Activity Bond Interest

Report interest subject to the alternative minimum tax (AMT) from specified private activity bonds.

Box 10: Market Discount

Report market discount on bonds purchased in the market.

Box 11, 12, 13: Bond Premium

Reports amortized bond premiums for different bond types such as taxable covered securities, U.S. Treasury bonds, and tax-exempt bonds.

Box 14: Tax-Exempt and Tax Credit Bond CUSIP No.

Add the CUSIP number used for identifying specific tax-exempt or tax credit bonds.

Boxes 15, 16, 17: State Information (If Applicable)

Report state-related data, including state name, ID, and amounts withheld for state income tax.

1099-INT Filing Deadline

Form 1099-INT Due date 2025 (To be filed in 2026) Notes
Furnish recipient copies (Copy B of 1099-INT) Feb 2, 2026 Original Due Date: Jan 31 (shifted dates due to holidays)
Paper Filing March 2, 2026 Original due date: Feb 28 (shifted dates due to holidays)
E-filing March 31, 2026

Penalties for 1099-INT

Timeline Penalty Amount (Per Form)
30 days late $60
31 days late through Aug 1 $130
After Aug 1 or not filed $330
Intentional Disregard $660

Troubleshooting Common 1099-INT Filing Issues

Error 1: Omitting Box 4 (Federal Income Tax Withheld)

Box 4 of 1099-INT reports any federal income withheld. If you omit this information, you may risk CP2100 notices and penalties. The remedy to this mistake is to file a ‘CORRECTED’ 1099-INT with updated details within 30 days.

Error 2: Issuing 1099-INT to exempt corporations

The IRS has a list of exempt corporations such as tax-exempt organizations, or government entities that do not require 1099-INT reporting. That’s why it’s considered a best practice to always confirm the entity type by collecting W-9 forms from the recipient.

Error 3: Missing FATCA checkbox

If you don’t comply with FATCA rules and omit FATCA status from your 1099-INT filing, it might lead to penalties. Make sure to carefully check withholding rules as well as W-9 information.

Error 4: Reporting interest income that is under $10

Interest income below $10 does not have to be reported to the IRS since it falls below the 1099-INT requirement threshold, unless backup withholding was triggered.

Real-Life Reporting Scenarios for 1099-INT

  1. If a bank credits $35 of interest to an individual Certificate of Deposits (CD), the bank needs to file Box 1 of 1099-INT. The interest amount they credited is above the minimum $10 reporting threshold.
  2. A SaaS company pays $750 in late-payment interest to a vendor. Since it’s a business-to-business transaction and the amount meets the $600 filing threshold for business interest payments, the company has to file 1099-INT for this payment.
  3. If a brokerage pays $5 sweep-account interest to an entity but withholds 24% backup tax, the firm still has to file 1099-INT. This is because even though the payment amount falls below the minimum 1099-INT filing requirement, backup withholding was triggered due to incorrect TIN or missing information.
  4. If a non-resident alien received $12 from a U.S. bank-deposit interest, the bank is required to file 1042-S for foreign citizens and not 1099-INT despite it being an interest payment as per IRS rules.
  5. A credit union has to file 1099-INT and report the bond interest amount on Box 6 if it withheld $150 foreign tax on $400 bond interest.

Interest income reporting is mandatory for banks and financial institutions that fall under 1099-INT filing requirements. And staying compliant with IRS rules helps prevent audits, notices, and penalties.

Whether you’re managing FATCA documentation, avoiding backup withholding notices, or submitting high-volume filings, Tax1099 is here to make 1099-INT filing seamless and easier with:

  • Real-time TIN Matching to prevent notices
  • Bulk data import for high-volume reporting
  • Auto-validation for interest thresholds and exempt recipients
  • W-9 Form solicitation tool for faster validation
  • E-file directly to the IRS and state agencies
  • Get access to audit-ready digital tax records

1099-INT FAQs

When is Form 1099-INT required?

Ans: Form 1099-INT filing requirements include reporting interest payments of $10 or more, reporting $600 or more in business or trade related interest, or any amount subject to backup or foreign tax withholding.

Do I need to report interest under $10?

Ans: Your business doesn’t need to report interest payments under $10 unless you have applied backup withholding or withheld foreign tax on the interest.

Are corporations always exempt from 1099-INT filing?

Ans: Corporations are generally exempt from 1099-INT reporting unless they receive credits from tax-credit bonds or you are the nominee reporting on behalf of others.

What if I exceed ten (10) 1099-INT information returns?

Ans: If you are filing more than ten 1099-INT forms, you need to e-file using an authorized e-filing platform like Tax1099.

How long must I keep 1099-INT records?

Ans: The IRS considers it a best practice to retain copies of all your 1099-INT records for at least 3 years. At Tax1099, we go a step further and store your tax records for at least 4 years for audit purposes.

Can I issue a consolidated year-end statement?

Ans: Yes, you can issue a consolidated year-end statement that combines all the interest amounts. However, you have to keep in mind that the 1099-INT data must be clearly identified, and the form language/box numbers preserved as per IRS rules.

What if I discover an error after filing?

Ans: If you made an error in your 1099-INT forms, you can correct the form by submitting a ‘CORRECTED’ Form 1099-INT with all the correct details and resubmitting it to the IRS. You should also furnish a corrected copy to the recipient.

Start preparing today and make interest income reporting one less thing to worry about.