I have the same issue with my state return currently taxing the 1099-B gain from a US Treasury Bill. I talked with a TT analyst for quite a while and made him aware of the issue. In my State, a subtraction for interst from a US Obligation is entered in one box. But this is a gain, so enter under Other subtractions. In the State screen that asks If You Have Any Items Not Taxed by (your state), check the Other box and enter there. Checking the box for Federally taxable exempt obligations did nothing for me and I believe this is a TT glitch. I asked the agent to pursue.
