Trying to figure out how IB calculates the accrued interest. I believe they pay out LIBOR (5.33% currently) -0.5%, so it is around 4.8% annual, am I correct? Let's say I have 100K on my IB acct and don't touch it all year long. There will be $4800 in the accrued interest in the end of the year (or $400/month). How will it be taxed (ball park)?
I took Libor rates from http://www.interestonlyloans.com/mortgage.html?WT.srch=1&gclid=COaEqufOuoQCFQefHgodlC_i-g Looks high to me also.
http://www.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc#interest USD LIBOR is 4.80 So you would get 4.3% on 90k. 4.3% * 90k = 3879 / 12 months = 322 month my guess.
IB only pays interest on funds over 10k (US) http://www.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc#credit (see tier one balance under US)