I am having the exact same problem with my Montana State Tax Return. I entered my 1099-INT showing that the U.S. Series EE Savings Bond interest is in Box 3. I double-checked my entry on the TurboTax Federal Worksheet and the bond interest is in Box 3. HOWEVER, TurboTax is not taking into account that this Savings Bond interest is not taxable by Montana. It shows the same amount of taxable interest for State and Federal returns. How do I fix this? I already E-Filed my Federal Return and it was accepted. I always print out my State return and hand deliver it since the Revenue office is only a mile from my house. Thank you for your help.
