Schedule B: Interest and Dividends

Schedule B (Form 1040) reports interest and ordinary dividends. Many people never need it. It is required when your totals are high enough, or when a special rule applies. The form has three parts. IRS: About Schedule B (Form 1040)

When you must use it

The IRS says you use Schedule B if any of these applies:

You had over $1,500 of taxable interest or ordinary dividends.
You received interest from a seller-financed mortgage, and the buyer used the home as a personal residence.
You had accrued interest from a bond.
You received interest or ordinary dividends as a nominee.
You had a financial interest in a foreign account, or you dealt with a foreign trust.

Other cases apply too, such as bond premium and some savings bond exclusions. IRS: About Schedule B

Part I: interest

Line 1 lists each payer's name and the amount paid to you. If you got a Form 1099-INT, list the firm named on that form, and enter the total interest shown. Line 2 adds line 1. Line 3 is for interest from some U.S. savings bonds, reported on Form 8815. Line 4 subtracts line 3 from line 2. The result goes to Form 1040, line 2b. IRS: Schedule B (2025)

Part II: dividends

Part II works the same way for ordinary dividends. Line 5 lists each payer. Line 6 adds those amounts. The total goes to Form 1040, line 3b. Your dividend payers usually appear on Form 1099-DIV. IRS: Schedule B (2025)

The $1,500 note

The form has a note under line 4 and under line 6. If the total is over $1,500, you must complete Part III. Part III asks about foreign accounts and trusts. It is mostly yes-or-no questions, with a few follow-up lines. IRS: Schedule B (2025)

Part III: foreign accounts and trusts

Line 7a asks if you had a financial interest in, or signature authority over, a foreign account at any time during the year. If you answer yes, the form asks whether you must file FinCEN Form 114. Line 7b lists the countries where those accounts are located. Line 8 asks about a distribution from a foreign trust, or about a role as grantor or transferor. The form says you may need Form 3520 for that. IRS: Schedule B (2025)

FinCEN Form 114 is not attached to your tax return. It is filed separately. Read FBAR basics for those separate rules.

Nominee amounts

If you received interest or dividends as a nominee, list them on the lines. Then write "Nominee Distribution" below the subtotal, and show the total you received as a nominee. The instructions say you must give the actual owner a Form 1099-INT for interest or a Form 1099-DIV for dividends, unless the owner is your spouse. IRS: Instructions for Schedule B (2025)

Seller-financed mortgages

If you sold your home and the buyer lived in it, list the interest the buyer paid you first. Show the buyer's name, address, and Social Security number. The instructions say you may have to pay a $50 penalty if you do not show that information, or if you do not let the buyer know your number. IRS: Instructions for Schedule B (2025)

Steps to follow

Total your interest and dividends from all your Forms 1099 and statements.
Check whether the total is over $1,500, or whether a special rule applies.
List each payer on Part I or Part II, with the amount.
If Part III applies, answer the foreign account and trust questions. Carry the totals to Form 1040, lines 2b and 3b.

Read Form 1099-INT and 1099-DIV basics for the forms that list your payers. Read Form 8815 for savings bond interest. Read Form 8938 for foreign assets reported on a different form.

General information, not advice for your situation.

Sources: Sources: IRS, Schedule B (Form 1040), Interest and Ordinary Dividends, 2025 (https://www.irs.gov/pub/irs-pdf/f1040sb.pdf); IRS, Instructions for Schedule B (Form 1040) 2025 (https://www.irs.gov/pub/irs-pdf/i1040sb.pdf); IRS, About Schedule B (Form 1040) (https://www.irs.gov/forms-pubs/about-schedule-b-form-1040) This is general information, not advice about your specific return.

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