Question on High-Balance Savings Account

[julianrojas72]

Sorry but I'm new to all this.....

What is the amount of money you must have in your savings account in order to start gettin taxed on it? I started getting taxed on $13k I believe. SHould i spread out my money to diff high intrest savings accounts? Thanks

[buzz]

Any interest you earn is entered on your 1040 tax form as income, and is taxed accordingly. Splitting your deposits among several banks makes no difference.

[moneybags]

Some banks don't send a 1099 if the interest is under a certain amount, say $60, but it is still taxable income that you are suppose to report. Also, most banks send a 1099 no matter what the amount.

[disneysteve]

I don't think this is what the OP was referring to, but if you are a child, there is a certain amount of interest you can earn that is not subject to tax.

Otherwise, for adults, the previous posters are correct. All income is taxable whether you get a 1099 or not.

[click4credit]

If the savings account interest was your only source of income then you would be entitled to your standard deduction. For a single adult this would mean you have to pay no tax on the first $5,150 of the income for the year. For most people who have an income then all your interest earnings would be liable for tax within the appropriate tax bracket dependant on your total income from all sources.

[DebbieL]

Here in Canada the bank doesn't send a form unless your interest comes to over $75. I guess you could spread your money out between quite a few banks if you want to avoid having any forms sent in. It seems like it would be a bit of a hassle to do this though.