Reporting Interest

Box 1 of Form 1099-INT shows taxable interest income received from the payer. This amount is reported on line 8a of Form 1040.

Box 3 shows taxable interest on U.S. Savings Bonds and Treasury obligations. Include the taxable portion with other amounts reported on line 8a of Form 1040.

Box 8 shows tax-exempt interest, and should be reported on Form 1040, line 8b.

If the total of interest received is over $1,500, Schedule B must be filed with the return.

Question: What if a taxpayer receives a mutual fund statement that shows tax-exempt interest?

Answer: Be sure to report all tax-exempt interest on line 8b of Form 1040.