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Withdrawing money from my CD?

Is the early withdrawal penalty that I paid when I took money out of my CD tax deductible?

Jul 11, 2012 by Marilyn from Greenwich, CT in  |  Flag
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6 votes

Yes it is. At tax time, you will receive a 1099 in the mail. On the 2011 Form 1040, the amount was entered on line 30.

Comment   |  Flag   |  Jul 11, 2012 from Fort Worth, TX

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3 votes

Yes. The entire penalty amount may be deducted on your personal 1040 (line 30) even if it exceeds the income or interest received.

1 Comment   |  Flag   |  Jul 11, 2012 from Amesbury, MA
Steve Stanganelli CFP®, CRPC®

See IRS Publication 550 for more details on this topic.

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Flag |  Jul 11, 2012 near Amesbury, MA

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