Form 1040A or 1040 (Schedule B) - Sep 2015

Schedule B (Form 1040): Interest, dividends and filing requirements

What does Schedule B (Form 1040) report?

Schedule B is an IRS form used to report interest and ordinary dividends when your totals exceed certain thresholds. It is filed as an attachment to Form 1040, not as a standalone return. The form has three parts, each covering a different reporting requirement.

Part I is where you list each source of interest income individually. Part II covers ordinary dividends from stocks, mutual funds and other investments. Part III asks whether you have a financial interest in or signature authority over a foreign financial account, or received a distribution from a foreign trust.

Do I need to fill out Schedule B?

Not every taxpayer needs to file Schedule B. The IRS requires it only when specific conditions apply to your return. You must file Schedule B if any of the following are true:

• You received more than $1,500 in taxable interest during the tax year.
• You received more than $1,500 in ordinary dividends during the tax year.
• You have a financial interest in or signature authority over a foreign financial account.
• You received a distribution from, or were a grantor of or transferor to, a foreign trust.

If none of these apply, you can report your interest and dividends directly on Form 1040 without attaching Schedule B.

What is included in Schedule B?

Schedule B requires you to itemize each source of interest and dividend income separately rather than reporting a single total. This means listing the name of every payer alongside the amount received.

For interest income in Part I, common sources include banks, credit unions, seller-financed mortgages and US savings bonds. For ordinary dividends in Part II, you would list income from brokerage accounts, mutual funds and real estate investment trusts. You should receive a Form 1099-INT or Form 1099-DIV from each payer, which provides the figures you need for Schedule B.

Is Schedule B required for all income levels?

Schedule B is not tied to your overall income level. The filing requirement is triggered specifically by receiving more than $1,500 in taxable interest or more than $1,500 in ordinary dividends. A taxpayer with modest total income but a high-yield savings account could still need to file it.

The foreign account and foreign trust questions in Part III also apply regardless of income. If either situation applies to you, Schedule B is required even if your interest and dividend totals fall below the $1,500 thresholds.

Is Form 1040 the same as 1040A?

Form 1040A was a simplified version of Form 1040 designed for taxpayers with straightforward filing situations. However, the IRS discontinued Form 1040A after the 2017 tax year as part of a broader effort to consolidate individual tax returns.

Since the 2018 tax year, all individual taxpayers use the standard Form 1040. The redesigned 1040 replaced both the old 1040A and the even shorter 1040-EZ. If you see references to "Form 1040A or 1040" on older versions of Schedule B, that language simply reflects the period when both forms were in use.

How does Schedule B affect my taxes?

Schedule B itself does not change the amount of tax you owe. It is a reporting form that ensures the IRS has a detailed breakdown of your interest and dividend income sources. The totals from Schedule B flow onto your Form 1040, where they become part of your overall taxable income.

That said, failing to file Schedule B when required can lead to issues. The IRS receives copies of every 1099-INT and 1099-DIV sent to you. If your return does not match those records, you may receive a notice or face penalties for underreporting income.

Where do I get a Schedule B form?

Schedule B is available directly from the IRS website at irs.gov, where you can download and print the current version. You can also request paper forms by calling the IRS at 1-800-829-3676 or by visiting a local IRS Taxpayer Assistance Center.

Most tax preparation software includes Schedule B automatically when your return meets the filing thresholds. If you prefer to work with the form yourself, our fillable Schedule B template lets you enter your information directly before printing.

What are Schedule B items?

The items reported on Schedule B fall into two categories: interest income and ordinary dividend income. Each payer must be listed as a separate line item with the corresponding dollar amount.

Common Schedule B interest items include:

• Interest from savings and checking accounts
• Interest from certificates of deposit
• Interest from US savings bonds and Treasury securities
• Interest from seller-financed mortgages
• Interest credited by insurance companies

Common Schedule B dividend items include:

• Ordinary dividends from stocks
• Mutual fund and ETF distributions
• Real estate investment trust (REIT) dividends
• Money market fund dividends

Capital gain distributions are reported separately on Form 1040 and do not belong on Schedule B.

Need to report interest and dividend income? Our free Schedule B (Form 1040) template makes it easy to get started. Use our fillable form to itemize your interest and ordinary dividends and generate an IRS-ready document in minutes. Try it today for free.