In order for this to be considered non-taxable income in Mass;
- When you report your 1099 INT, there should be an amount in Box 3 Interest on U.S. Savings Bonds and Treas. obligations. this will tax the interest on the federal side but MAY exempt interest on the state side. when you select this and press continue
- there will be screen that asks Do any of these uncommon situations apply? You will select My state doesn't tax all of this interest
- When you begin your state return, as you navigate through the section, there will be a page entitled interest and dividends. At the bottom, it will say Other interest or dividends to be excluded $xxx.xx this should be the full amount that is shown on your 1099INT in Box 3.
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