Originally Posted by Zebus
#1;Can anyone tell me if I need to claim the interest on my security deposit for my rented flat as income?
#2;If so, where and how should I report it? I did not receive a 1099-INT or any tax-related form.
#1;it depends; Whether a tenant earns interest on a security deposit is determined by state law. A security deposit protects a landlord against your breaking the lease early and leaving him without rent or from excessive damages to the property. Because you must pay this money to the landlord and cannot use it while you live on the property, many states require the landlord to pay interest on the funds.you nedd to contact dept of rev of your state
#2; not all interest income is reported on 1099-INT, Most U.S. banks, financial institutions, and other payers of interest are required to provide taxpayers and the IRS with a 1099-INT any time the taxpayer earns $10 or more in interest during the year. Even if your interest income is not reported to you on a 1099-INT, you are still required by law to report the income on your tax return.Taxable interest goes on Line 8a of Form 1040 . Sch B is a supplemental tax form used to tally up interest and dividend income from multiple sources. Using Schedule B is required if you have over $1,500 in interest and/or dividends. Even if you are not required to file Sch B, you can utilize the form to tally up your interest and dividends for reporting on your Form 1040