The IL Schedule M is part of the IL return and will show the federal interest income that is a subtraction on the IL return on the bottom of Sch M line 32 of the IL return automatically as long as it is entered correctly in the federal return and the state return added.
IL subtracts certain federal government interest on the state return and it shows on IL Schedule M, the form where IL additions and subtractions due to the state tax code varying from the federal tax code occur.
