If total interest less excludable interest on series EE and I U.S. savings bonds issued after 1989 is greater than $1,500, or if total dividends are greater than $1,500, Schedule B Part III must be completed. To access Part III, from the Main Menu of the tax return (Form 1040) select:
- Interest or Dividends (Sch B, 8815)
- Other button
Schedule B Questions\Form 8815 – Select this line to answer the questions in Part III and to prepare Form 8815, Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989.
- Financial Account in a Foreign Country – Answer the questions related to foreign banking and securities accounts. Your client may be required to file FinCEN 114. See here for more information about the requirements.
- Transferor or Grantor to a Foreign Trust – If the answer to the foreign trust question is YES, your client may need to complete Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts which itself may require Form 4970, Tax on Accumulation Distribution of Trusts. These forms are not provided in Keystone Tax Solutions Pro and must be mailed to the IRS separate from the tax return. See the Form 3520 instructions to determine if it is needed.
- Excludable Interest from Form 8815 – See here for information on completing Form 8815.
Remove Schedule B – Select this line to remove Schedule B if it was prepared by mistake, and instead all interest and dividends will be entered in the tax return under the income line “Interest or Dividends (Less than $1500)”.
Note: This is a guide to completing Schedule B Part III in the Keystone Tax Solutions Pro program. This is not intended as tax advice.