Line 2, Taxable Interest(p11)

If you received interest payments, you should receive a Form 1099-INT or Form 1099-OID from each payer. Report all of your taxable interest income on line 2 even if you did not receive a Form 1099-INT or 1099-OID. If you are filing a joint return, also include any taxable interest received by your spouse.

Include interest received on amounts deposited with banks, savings and loan associations, credit unions, or similar organizations. If interest was credited in 2012 on deposits that you could not withdraw because of the bankruptcy or insolvency of the financial institution, you may be able to exclude part or all of that interest from your 2012 income. But you must use Form 1040A or 1040 to do so. See Pub. 550 for details.

You should also include taxable interest on bonds and other securities. If you cashed U.S. series EE or I savings bonds in 2012 that were issued after 1989 and you paid certain higher education expenses during the year, you may be able to exclude from income part or all of the interest on those bonds. But you must use Form 8815 and Form 1040A or 1040 to do so.

You must use Form 1040A or 1040 if you received taxable interest of more than $1,500. You also must use Form 1040A or 1040 if any of the following apply.

• You received interest as a nominee (that is, in your name but the interest income actually belongs to someone else).
• You received a 2012 Form 1099-INT for U.S. savings bond interest that includes amounts you reported before 2012.
• You owned or had authority over one or more foreign financial accounts (such as bank accounts) with a combined value over $10,000 at any time during 2012.

If you received tax-exempt interest, such as interest on municipal bonds, each payer should send you a Form 1099-INT. Your tax-exempt interest should be shown inbox 8 of Form 1099-INT. Enter TEI and the amount in the space to the left of line 2. Do not include tax-exempt interest in the total on line 2.