Taxes on Bonds

If I buy a bond in between the interest dates, the accrued interest from before I buy the bond will be included in My 1099-INT as taxable income. I can deduct the accrued interest from the 1099-INT amount on My tax return. If I have over $1,500 in interest income and need to file Schedule B, I would have one line that reports the full amount of the 1099-INT then the next line I would write down Accrued Interest and enter the amount of accrued interest as a negative to reduce the taxable amount of interest income. For example, I buy a company's bond that pays out interest once a year on January 1st. If I buy the bond in the middle of the year on July 1st and the company pays I $1,000 in interest on January 1st, I will receive a 1099-INT from the company for a full $1,000. Since I only owned the bond for half the time period the interest was accruing, only $500 of the bond interest would be taxable income on My tax return.

For tax filing purposes, look carefully at 1099-INT issued to you. Box 1 will show all interest, go to section where my broker describes accrued interest. Have a worksheet to deduct accrued interest from tolat interest.

On details of 1099INT, there are two entries from my broker:
1) Accrued interest on Sale of Bonds
2) Accrued interest on Purchase of Bonds

Question: Should I deduct both 1 & 2 above or just 2

http://www.costbasis.com/bondsnotes/discountpurchase.html