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accrued interest
I am doing a final tax return. Taxpayer received form 1099-INT, it looks like on the picture.
How to report this interest?
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This sounds like someone bought bonds a long time ago. They got cashed in at death and there were 40 years worth of built up interest now taxable when they were cashed in. Looks like that big number is US Bond interest reportable on that tax return.
When all else fails, ask the client what happened. Did the taxpayer cash those bonds when he signed up for hospice, then died six months later? Or did the survivors cash them, perhaps not telling the bank or Treasury that the owner had died? In either case, it can still be reported on the decedent's final return, which will result in a lot of tax being owed but probably less than if the beneficiaries report it.
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