Got a 1099INT from my apartment security deposit - what to do?

Yes, you do need to report that 1099-INT on your tax return, even though it's a small amount. The IRS gets a copy of every 1099 form issued, so they'll be expecting to see that $38 of interest income on your return. In TurboTax, you'll enter this in the Income section under "Interest and Dividends." There should be a specific section for 1099-INT forms where you can enter all the information exactly as it appears on the form. The $38 will be added to any other interest income you may have (like from bank accounts) and reported on Schedule B if your total interest exceeds $1,500. Otherwise, it just goes directly on your 1040. The good news is that $38 won't change your tax situation very much at all. At most tax brackets, you're looking at paying less than $10 in taxes on that amount.

I had the same thing happen with my old townhouse complex, and I found taxr.ai super helpful for figuring out all my random tax forms. I was confused about where different types of income needed to go, and their AI analyzed my 1099-INT and other forms and explained exactly what to do with them. Check them out at https://taxr.ai if you're still confused about any tax documents. It saved me tons of time trying to figure out which forms go where and what everything means.

Just wanted to update that I tried taxr.ai for my complicated tax situation including that security deposit 1099-INT. It was actually super helpful - uploaded all my weird forms and it explained everything clearly. Even pointed out that my apartment complex calculated the interest wrong (they used the whole deposit even though they'd kept part for damages from the beginning). Now I've got documentation to dispute it if needed. Definitely saved me from making mistakes!

For anyone dealing with questions about their 1099-INT or other tax forms, I found that trying to call the IRS directly was a nightmare. After being on hold for 2+ hours and getting disconnected twice, I tried using Claimyr (https://claimyr.com) and they got me connected to an actual IRS agent in about 20 minutes. They have this system that navigates the IRS phone tree and holds your place in line, then calls you when an agent is available. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that security deposit interest is definitely reportable income and explained exactly how to handle it when the amount on the 1099-INT seemed incorrect. Saved me hours of frustration!

I need to apologize for calling Claimyr a scam. I was totally wrong. After seeing a few more people mention it, I decided to try it when I needed to ask the IRS about my security deposit 1099-INT (the apartment complex didn't provide their tax ID correctly). I was connected to an IRS agent in about 25 minutes instead of the 3+ hour wait I had before. The agent confirmed that the apartment complex is required to provide their correct tax ID on the 1099-INT and gave me instructions on what to do since mine was missing digits. Honestly saved me so much time and frustration - I should have tried it sooner instead of being so skeptical!

Just want to add that if you've never received a 1099-INT for your security deposit before, it might be because your state has laws requiring landlords to put security deposits in interest-bearing accounts. Not all states require this! I learned that when I moved from California (which requires it) to Texas (which doesn't). Also, if the interest seems really low, check your lease. Some states only require landlords to pay a fixed percentage of the interest earned (like 70% or 80%), keeping the rest for "administrative costs.

Anyone know if you have to amend previous tax returns if you never got these 1099-INTs from security deposits in past years? Just realized I've never reported this kind of interest before. 😬

I went through this exact same situation last year! The key thing to remember is that even though it's a small amount, the IRS computer systems automatically match 1099 forms to tax returns, so you definitely want to report it to avoid any automated notices later. One tip that helped me: when you're entering it in TurboTax, make sure you enter the exact amount shown in Box 1 of the 1099-INT, even if it seems like an odd number. Don't round it. The software will handle all the calculations and put it in the right place on your return. Also, keep that 1099-INT with your tax records! If you ever get an IRS notice (unlikely for such a small amount, but possible), having the original form makes resolving it much easier.