I think I have figured out a work-around for TurboTax counting trust tax exempt income twice for CT taxes.
The problem is that if your K-1 shows tax exempt income (Code A in box 14) and the income is taxable in CT (e.g. from a national muni bond fund) you would think when going through the K-1 questions in TurboTax that you should select "Multiple states" for the source of the income. This causes the income to flow to CT-1040 line 31.
However it turns out that an adjusted version of this income is also included on the CT Fiducuary Adjustment line of the CT-1041 that is provided along with the federal K-1. When you enter this in the CT portion of TurboTax, the tax exempt income is counted twice in the CT tax computation.
The work-around is when entering the K-1 numbers in the Federal section of TurboTax, you should say that the tax-exempt income is from CT and not from multiple states. That stops it from showing up on CT-1040 line 31.
Disclaimer: I am not a tax advisor.
