I earn Tax-exempt interest on Muni bonds and pay a bond premium at purchase. Boxes 8 & 13 are populated.
(None are federally taxed & only out-of-state are taxed by my state)
When entering the interest I select Various states and enter the totals by state. I also enter (or maybe it is imported) the Bond Premium in Box 13. Prior to this year I also 'adjusted the interest earned' using the 'amortization of bond premium' option by state AND also adjusted my Tax-exempt interest upwards on my state return by the interest earned for each of the out-of-state bond by state total. I now believe both of these were in error, and simply entering the interest earned by state would have allowed the correct treatment of both the Federal and state taxes.
My questions are: Is this correct and if not, how should this interest be treated in TurboTax?
AND, has TurboTax's treatment of the issue above always been this way, or did it change at some point in time?
