Your federal bond interest should flow through to your Virginia state tax return properly.
When you enter your Form 1099-INT into TurboTax the information and codes on that Form should properly determine the taxability to your state tax return.
For instance: Box 3 reports interest earned on U.S. savings bonds or Treasury notes, bills or bonds. Some of this may be tax-exempt.
Interest income from Treasury bills, notes and bonds is subject to federal income tax, but is exempt from all state and local income taxes.
Click here for 1099-INT information.
Click here for "A Guide to Investment Bonds and Taxes."
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