Fidelity/Schwab. 1099 interest change for 2025, Box 1 and Box 3

[wolf]

Avoid my mistake. Prior years, Fidelity and Schwab, 1099-INT. Box 1 was interest earned (ie Cd's, etc) and Box 3 was interest earned (ie Treasury). They separated the two types of interest earned on the 1099-INT. This year, 2025, they did not. Using Tax software, I entered the "Box 1" amount for my Federal Return. My Federal Return is fine.

Problem, when Tax software imported Federal Return to prepare State return it "taxed interest earned on Treasuries". Treasury interest exempt from State tax. I did not catch this error in time.

Because I already sent in State return. NOW I have to go thru the trouble of sending in an amended State Return.

 

[PaunchyPirate]

Interesting. My 1099-INT from Schwab splits out my matured T-Bill interest nicely into Box 3. Not sure why they didn't do that with yours.

Did you perhaps sell your Treasuries before they matured? I wondered how the tax treatments would be for a secondary market sale transaction.

 

[mrfeh]

Avoid my mistake. Prior years, Fidelity and Schwab, 1099-INT. Box 1 was interest earned (ie Cd's, etc) and Box 3 was interest earned (ie Treasury). They separated the two types of interest earned on the 1099-INT. This year, 2025, they did not. Using Tax software, I entered the "Box 1" amount for my Federal Return. My Federal Return is fine.

Can't speak to Schwab, but Fido's 1099-INT is the same this year as last.

Line 3 interest is not included in line 1.

I seriously doubt Schwab changed theirs either.

 

[RetiredAndLovingIt]

What Tax Software are you using? I had no problem with Turbo Tax.

 

[wolf]

Interesting. My 1099-INT from Schwab splits out my matured T-Bill interest nicely into Box 3. Not sure why they didn't do that with yours.

Did you perhaps sell your Treasuries before they matured? I wondered how the tax treatments would be for a secondary market sale transaction.

Thanks. You might have provided a clue to what happened. I purchase a lot of Treasury Agency bonds.
ie. Federal Home Loan Bank, "FHLB". And Federal Farm Credit Bank, "FFCB". They typically have maturities of 20 to 40+ years. But they do have "CALL" feature. Issuer can redeem "Call", the bond early at their discretion.

So, I did not sell any Treasury Agency bond. There is no gain or loss on principal. The issuer, just gives me my money back, and I presume borrows new debt at a lower interest rate.

But for some reason, this must be why both Fidelity and Schwab, did not separate interest into Box 1, 3.
Since you guys had no issues. And in 2023, 2024. I had no Treasury Agency calls. And Fidelity and Schwab, used both Box1 and 3. THIS IS THE ONLY LOGICAL CONCLUSION. THANKS.