I am a Indian citizen on an F-1 visa and have become a resident alien from the year 2008. I believe that I need to report my Indian bank interest earned during 2008. The combined value of my accounts is less than $10,000. I have following questions:
1. Do I need to submit Schedule B with 1040 form?
2. Where do I mention my Indian bank interest. Would it be in line 8a of 1040?

Thanks!

On F1/OPT you are exempt from residency for 5-years. You must file non-resident tax return Form 1040NR or 1040NR-EZ and Form 8843. Your income is not subject to FICA taxes but you must pay federal and state income taxes.

Bank interest is not taxable for nonresidents.

Read: Your U.S. Tax Return: U.S. Tax Filing Requirements for Non-Residents

I arrived in US in 1 Aug 2003 on F-1 and I continue to be on F-1. Therefore, I am a resident alien for 2008. I have heard that as a resident alien I need to disclose my Indian bank interest earned during 2008. The combined value of my Indian bank accounts is less than $10,000.

1. Do I need to submit Schedule B with 1040 form (with only Part III filled)?
2. Where do I mention my Indian bank interest. Would it be in line 8a of 1040 together with the U.S. bank interest earned?

Thank you so much.

You need to include the Indian interest income on your U.S. tax return. Include on line 1 of Schedule B. If the balance of the account did not exceed $10,000 at any point during the year, you should not complete line 8a.

On the resident tax return, you will report worldwide income. If you paid taxes on India bank interest, then you will also file Form 1116 to claim foreign tax credit. Your U.S. Tax Return: U.S. Citizen or Resident with Foreign Income