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January 24, 2025
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Early withdraw penalty on CD - entered on 1099-INT form but not reflected in bottom line interest

  • January 24, 2025
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 In 2024 I closed a CD early.  This is reflected on the 1099-INT from my bank:  E.g.   Box 1 Interest  Earned:  $10,000.   Box 2 Early withdrawal penalty: $1000.  This is how I entered it in TurboTax Form 1099-INT.  This is correctly reflected on the TurboTax Schedule B form in the Interest Income Smart Worksheet.  However, further down the Sch. B form in the Part 1-Interest section, the interest shows as $10,000.   I would expect to see the penalty subtracted here for a net interest of $9000.    I cannot locate this penalty deduction anywhere else in TT.  What am I missing?

    Best answer by JeffdelRey

    FOUND IT.

    It appears on Schedule 1 Part II Adjustment to Income.

     

     

    1 reply

    JeffdelReyAuthorAnswer
    January 24, 2025

    FOUND IT.

    It appears on Schedule 1 Part II Adjustment to Income.