ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Monday, March 4, 1996                  TAG: 9603060025
SECTION: MONEY PAGE               PAGE: 6    EDITION: METRO 
COLUMN: Money Matters
SOURCE: MAG POFF

INTEREST ON DC IS TAXABLE IN YEAR RECEIVED

Q: I purchased a certificate of deposit in April 1995 and reinvested the interest. It is payable in July 1996. Is the interest earned in 1995 but not available until 1996 taxable on my 1995 return, or can it be deferred until 1996?

A: The interest is taxable in the year in which it is paid. In your case that will be 1996. The bank is required to send you a 1099 interest form showing the amount of income reported to the government on which you must pay taxes.

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