Yes. The early withdrawal penalty is an adjustment to income so it will reduce your gross income which reduces your adjusted gross income. When you enter your 1099 INT into Turbo Tax, the early withdrawal penalty will automatically be reported as an adjustment to income on your Form 1040.Please refer to the following FAQ for instructions on how to enter your Form 1099-INT. https://ttlc.intuit.com/replies/3300478 After you enter your Form 1099-INT, you can use these instructions to check your Form 1040 line 30 Login to your Turbo Tax accountclickon "take me to my return"Clickon "my account" tab at the very top of the screenClickon "tools"Clickon "view tax summary"Clickon "preview my 1040". This is part of a narrow white bar at the verytop of the screenWhen your 1040 form appears, you will be able toscroll through and look at the individual line items.Clickthe "back" button when you want to return to your main Turbo Taxscreen. The back button is part of a narrow white bar at the very top of thescreen.

TurboTax

File with experts
File your taxes
Experts at your fingertips

An expert helps with your taxes, or does them for you
TurboTax Expert Full Service

TurboTax Expert Assist

TurboTax Self-Employed
Prior year taxes
File myself
File myself
Do it yourself

We'll guide you step-by-step
TurboTax Do It Yourself

TurboTax Self-Employed

TurboTax Desktop
TurboTax Free

Activate your product

Prior year taxes
Business
Business
Business taxes

Get your T2 corporate return done right, your way
TurboTax Business

TurboTax Business Desktop
Tax situations
Tax situations
Tax situations

Find extra guidance for your big life moves
For investors

For 25 and younger

For self-employed

For new to Canada

For life changes
Resources
Resources
Resources

Explore tax tools, get tips, and read reviews
Personal income tax calculator

RRSP savings calculator

Learning hub

TurboTax support (FAQ)

TurboTax community
Pricing

Community

mrbrian2004

Question

On Form 1099-INT, Box 2 (Early withdrawal penalty) we have an amount. Will this help any. If so, where do we enter this amount?

Forum|Forum|6 years ago
June 6, 2019
2 replies
0 views

No text available

TurboTax Free Edition Online

AndreaG

Employee

Yes. The early withdrawal penalty is an adjustment to income so it will reduce your gross income which reduces your adjusted gross income. When you enter your 1099 INT into Turbo Tax, the early withdrawal penalty will automatically be reported as an adjustment to income on your Form 1040.

Please refer to the following FAQ for instructions on how to enter your Form 1099-INT. https://ttlc.intuit.com/replies/3300478

After you enter your Form 1099-INT, you can use these instructions to check your Form 1040 line 30

Log in to your Turbo Tax account
click on "take me to my return"
Click on "my account" tab at the very top of the screen
Click on "tools"
Click on "view tax summary"
Click on "preview my 1040". This is part of a narrow white bar at the very top of the screen
When your 1040 form appears, you will be able to scroll through and look at the individual line items.
Click the "back" button when you want to return to your main Turbo Tax screen. The back button is part of a narrow white bar at the very top of the screen.

natashamorales17

what is the tax treatment for a cd penalty that was assessed in a prior year (e.g. 2021) and then identified as an error in 2024? are corrected 1099's required or do we issue a 1099 INT for the year the money was refunded?

JotikaT2

Usually, banks or financial institutions where your CD was held would issue the 1099-INT form so not sure why you as a customer would issue a 1099-INT. I'd recommend contacting the financial institution or bank where the CD was held to find out whether they would be planning to issue a corrected 1099-INT for the tax year where the penalty was initially assessed or if they will issue a 1099-INT for the year when the penalty was reversed.

Since tax returns are typically prepared on the cash basis, it would make sense that they would issue a 1099-INT for the year of repayment, but verifying with the bank is your best way to confirm.

@natashamorales17

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"