Many threads on this topic (see below) - there is a lot of ambiguity and debate on this depending on language of the state tax codes. Not a CPA myself so can't advise but just wanted to provide some more context, hope this helps...
There is a general argument made on the internets that the AMD is coming from a third party on the secondary market (i.e someone else's loss from buying at original issue) rather than directly from the government (tho technically the market price may include some OID certainly coming from the Treasury); however plenty of arguments made the other way that it is anyways exempt depending on a particular state's tax code (parsing definitions of "interest" and "income derived from" etc). NC resolved it in the courts as being taxable, other state tax agencies may have issued clearer guidance on handling of AMD, so it depends on your state.
If unclear or uncomfortable with the status it's best to consult with an advisor/CPA who is expert in the state tax code, which sounds like what you have done.
If the AMD is considered exempt for your state, the only solution I've seen for this in TT is to make a miscellaneous/manual adjustment with explanation in the state tax section which I believe most of the state tax programs handle in some form, tho some people reported this precluded e-file (NY was one I think); or file manually.
I have seen others comment that other software provides more flexibility but not tried myself.
Personally, I've stopped buying low coupon notes to minimize or avoid this issue and state adjustment in future, you can usually find T-Bills and higher coupon T-Notes trading at a slight premium for similar dates and yields on the secondary market which have simpler tax reporting.
A few of the many other threads on this topic (the first one is the main kicked off in 2023)...
https://ttlc.intuit.com/community/taxes/discussion/accrued-market-discount-on-treasury-bonds-state-t...
https://ttlc.intuit.com/community/taxes/discussion/re-i-bought-trsy-notes-at-a-discount-my-broker-s-...
https://ttlc.intuit.com/community/taxes/discussion/re-accrued-market-discount-on-new-york-tax/01/357...
https://ttlc.intuit.com/community/taxes/discussion/accrued-market-discount-on-treasury-bonds/00/3156...
https://ttlc.intuit.com/community/taxes/discussion/re-accrued-market-discount-on-treasury-bond-ny-st...
