2025 Form 1040, Line 2b
Taxable Interest: Line 2b and the 1099-INT
2025 Form 1040, Line 2b — taxable interest from 1099-INT Box 1: bank accounts, CDs, Treasury, bonds. Gross income under IRC §61(a)(4). Tax-exempt muni interest is disclosed on Line 2a instead and never taxed — see Guide Ch. 2.
What counts
Every dollar of interest paid to you, whether or not you got a form — payers skip the 1099-INT under $10, but the income still counts. Savings, money market, CDs, Treasury bills and bonds, corporate bonds, even interest on a tax refund.
The $1,500 Schedule B tripwire
When interest plus ordinary dividends tops $1,500, you list every payer on Schedule B and carry the totals to Lines 2b and 3b. Under that, straight onto the 1040 — no schedule.
From the practice: Treasury interest is exempt from state tax but fully federal — the single most missed split on this line. Gross income, at book length →
Questions, answered
- No 1099-INT — do I still report it?
- Yes. Payers skip the form under $10, but the interest is still gross income under §61(a)(4). Report every dollar.
- What's the difference between Line 2a and 2b?
- Line 2a is tax-exempt interest (muni bonds, §103) — disclosed but not taxed. Line 2b is taxable interest — bank accounts, CDs, Treasury, bonds.
- When do I need Schedule B?
- When interest plus ordinary dividends tops $1,500. Then you list every payer on Schedule B and carry the totals to Lines 2b and 3b.
Keep reading: Dividends (Lines 3a/3b) · Total Income (Line 9) · Wages (Line 1)