If your business paid interest on a loan, security deposit, or account last year, you may have a Form 1099-INT filing obligation. Most banks and credit unions are well aware of this. But plenty of other businesses don’t realize it applies to them, especially those dealing with promissory notes, security deposits, or private lending.
Here’s what you need to know: Who is required to file Form 1099-INT, what interest qualifies, and what the step-by-step process looks like.
One thing that may confuse businesses is that there are two different reporting thresholds, $10 and $600, and which one applies depends on the type of payer you are. Getting that wrong is one of the most common 1099-INT mistakes businesses make.
What Is Form 1099-INT and What Does It Report?
Form 1099-INT is an IRS information return used to report interest income paid to a recipient. It is filed by the payer—the entity that paid the interest—not the person who received it. If you credited interest on a savings account, paid interest on a private note, or issued interest on a security deposit, the filing obligation is yours.
It serves two purposes: it tells the recipient how much taxable (or tax-exempt) interest income they need to report on their own tax return, and it tells the IRS, so the agency can cross-check the recipient’s filing.
What gets reported on 1099-INT:
- Interest on savings accounts, CDs, and money market accounts
- Interest on corporate bonds, notes, and promissory notes
- Interest paid on security deposits
- Tax-exempt municipal bond interest (Box 8)
- S. savings bond and Treasury interest (Box 3)
What does NOT go on 1099-INT:
- Original Issue Discount (OID): goes on Form 1099-OID
- Dividends: reported on Form 1099-DIV
If interest was paid in cash to a recipient, it belongs on 1099-INT. If the “interest” is a discount built into the instrument and never actually paid, it belongs on 1099-OID. Getting this distinction right matters.
Who Is Required to File Form 1099-INT?
Form 1099-INT is required from any payer that paid reportable interest to a U.S. person during the tax year. This applies more broadly than most businesses expect:
- Banks, credit unions, and savings institutions: for deposit accounts, CDs, and savings bonds
- Brokerages and investment firms: for bond and mutual fund interest
- Corporations and LLCs: for private loans or deferred compensation arrangements
- Businesses that hold security deposits and pay interest: Many states require landlords and commercial property owners to pay interest on deposits held, which triggers a 1099-INT obligation
- Life insurance companies: for policy-related interest
- Any entity that withheld backup withholding or foreign tax
That last point trips up a lot of businesses. Even if the amount is below the threshold, backup withholding creates a filing requirement.
Who is generally exempt:
- Tax-exempt organizations paying exempt recipients
- Payments to foreign payees (Form 1042-S applies)
- Most payments to C-corporations
The Two Reporting Thresholds: $10 and $600 Explained
A common source of confusion is that there are two thresholds, and which one applies depends on the type of payer, not just the amount.
| Rule | Applies To | Threshold |
| $10 rule | Financial institutions | File if $10 or more |
| $600 rule | Trade or business payers | File if $600 or more |
Backup withholding exception: If you withheld any federal income tax or foreign tax, you must file Form 1099-INT regardless of the amount.
Example: A business pays $450 in interest on a private loan. No filing is required under the $600 rule. But if backup withholding applies, a 1099-INT must still be filed.
Form 1099-INT Boxes Explained
Using the wrong box is one of the most common 1099-INT filing errors. Here’s what each box is for:
| Box | What It Reports | Key Notes |
| Box 1 — Interest Income | Taxable interest paid, excluding amounts in Box 3 | The most commonly used box. Does not include Treasury or savings bond interest. |
| Box 2 — Early Withdrawal Penalty | Penalty charged for early withdrawal from a CD or time deposit | The recipient can deduct this penalty on their return. Report when applicable. |
| Box 3 — U.S. Savings Bond / Treasury Interest | Interest on U.S. savings bonds and Treasury obligations | Taxable at the federal level but generally exempt from state and local taxes. |
| Box 4 — Federal Income Tax Withheld | Backup withholding at 24% | Report here when backup withholding was imposed. A 1099-INT is required even if Box 1 is below the threshold. |
| Box 5 — Investment Expenses | Single-class REMIC only | Rarely used. Applies only to specific REMIC structures. |
| Box 6 — Foreign Tax Paid | Foreign tax withheld on interest | Report when applicable. The recipient may claim a foreign tax credit. |
| Box 7 — Foreign Country / U.S. Possession | Country where Box 6 tax was paid | Required if Box 6 has an entry. |
| Box 8 — Tax-Exempt Interest | Municipal bond interest (federally tax-exempt) | Still reportable. The IRS needs this for AMT calculations even though it’s tax-exempt. |
| Box 9 — Specified Private Activity Bond Interest | Tax-exempt interest that is subject to AMT | A subset of Box 8 for bonds subject to Alternative Minimum Tax. |
| Box 10 — Market Discount | Accrued market discount on bonds | Report when market discount applies to the instrument. |
| Box 13 — Bond Premium | Amortizable bond premium | Offsets Box 1. The recipient may deduct this premium. |
Do not combine Box 1, Box 3, and Box 8 amounts into a single entry. Each type of interest must be reported separately.
2027 Filing Deadlines for Form 1099-INT
Form 1099-INT follows the standard deadline structure for most 1099 forms (excluding 1099-NEC):
| Deadline | Date | What’s Required |
| Recipient Copy Furnished | February 1, 2027 | Send Copy B to each payee by mail, or electronically with documented consent |
| IRS Paper Filing | March 1, 2027 | File paper Form 1099-INT with Form 1096 as the transmittal |
| IRS eFile Deadline | March 31, 2027 | eFile via IRS IRIS or an approved third-party provider |
Mandatory eFile rule: If your business has 10 or more total information returns across all form types (1099s, W-2s, 1098s combined), you must eFile.
Extensions: File Form 8809 for IRS deadline extensions. This does not extend the recipient copy deadline.
Common Mistakes Businesses Make When Filing Form 1099-INT
These errors most often lead to IRS notices:
- Using 1099-INT for OID income instead of Form 1099-OID
- Missing the backup withholding filing requirement
- Reporting under a DBA instead of the legal entity name (can trigger a CP2100 mismatch notice)
- Skipping Box 8 for tax-exempt interest
- Filing 1099-INT for a foreign payee instead of Form 1042-S
How to File Form 1099-INT Online: Step by Step
Here’s how to file Form 1099-INT using an eFile platform like eFileMyForms:
Step 1: Collect W-9s from all payees. Confirm each payee’s legal name, Taxpayer Identification Number (TIN), and entity type before entering any data. For foreign individuals, collect Form W-8BEN instead.
Step 2: Verify TINs before entry. eFileMyForms includes a built-in TIN matching to confirm the payee name and TIN against IRS records. Running this check first helps prevent CP2100 mismatch notices.
Step 3: Create a new filing. Select Form 1099-INT, enter the tax year (2026 for the 2027 filing season), and import payee data via CSV/Excel or enter it manually.
Step 4: Enter amounts per box. Use the box guide above to place each amount correctly. Do not combine Box 1, Box 3, and Box 8 amounts.
Step 5: Review, validate, and submit. Check for missing TINs, formatting issues, and other errors before submitting. Once everything looks correct, file electronically with the IRS.
Step 6: Deliver recipient copies. Print and mail copies or use secure e-delivery with documented payee consent. Both options provide a delivery record.
Step 7: Save your confirmation. Keep your IRS acceptance confirmation for your records. If you need to make a correction later, you can file a corrected 1099-INT through the same platform.
1099-INT vs. 1099-OID vs. 1099-DIV: Which Form Applies?
These three forms are the most commonly confused when it comes to interest and income reporting. Here’s how to tell them apart:
| Form | Reports | Common Filers |
| 1099-INT | Cash interest paid on accounts, bonds, loans, and deposits | Banks, credit unions, businesses paying interest |
| 1099-OID | Original Issue Discount; taxable interest that was never paid in cash (discount on bonds sold below face value) | Bond issuers, brokerages, certain debt instruments |
| 1099-DIV | Dividends, capital gain distributions, return of capital | Corporations, mutual funds, investment accounts |
If interest was paid in cash, use 1099-INT. If it is built into the instrument, use 1099-OID. If it is a distribution of profits, use 1099-DIV.
What to Do Next
Form 1099-INT must be filed by any entity that paid $10 or more in interest (or $600 in a trade or business context), as well as any entity that imposed backup withholding. Using the wrong box or missing a filing requirement can lead to corrections and penalties.
The 2027 eFile deadline is March 31. If you file 10 or more returns, you must eFile.
When you’re ready to file, get started with eFileMyForms to eFile Form 1099-INT, verify TINs, deliver recipient copies, and track filing status in one place.
FAQs
Do I need to file Form 1099-INT if I paid less than $10 in interest?
It depends on the type of payer. Financial institutions use the $10 rule, while trade or business payments follow the $600 rule. If backup withholding applies, you must file regardless of the amount.
What happens if I miss the 1099-INT deadline?
Penalties start at $60 per form and increase over time. Filing late reduces total penalties compared to not filing.
Can I file a corrected 1099-INT if I made an error?
Yes. If you filed with the wrong amount, put money in the wrong box, or used an incorrect TIN, you need to file a corrected 1099-INT. Mark the “Corrected” box at the top of the form, enter the correct information, and resubmit.
Do I need to send a 1099-INT to a corporation?
Generally, no. Interest paid to a C-corporation in its corporate capacity is typically exempt from 1099-INT reporting. However, there are exceptions, such as payments to financial institutions or cases involving backup withholding. Before deciding, verify the payee’s entity type on their W-9.
What’s the difference between eFiling through IRS IRIS and using eFileMyForms?
IRIS is the IRS portal. eFileMyForms provides additional features like bulk upload, validation, delivery, and tracking. Both submit directly to the IRS. With a solution like eFileMyForms, businesses do not have to go through the process of obtaining a new TCC (Transmitter Control Code) with the IRS and can file directly with eFileMyForms.
Is Box 8 tax-exempt interest still required if the interest isn’t taxable?
Yes. Even though municipal bond interest in Box 8 is federally tax-exempt, it must still be reported on Form 1099-INT. The IRS uses this data for Alternative Minimum Tax (AMT) calculations. Skipping Box 8 because the interest is “tax-exempt” can lead to a reporting error.