First, you all need to read what the State of Virginia says about this form - it will answer many of your questions. You can also see a sample form at this Virginia Department of Taxation webpage.
The reason that there has been so much confusion is because the State of Virginia just made up this form in the last couple of years. For this reason, TurboTax does not have explicit input screens for it.
On the 1099-G/INT, box 1 is the same as box 2 on the 1099-G, i.e., the state tax refund.
On the 1099-G/INT, box 2 is the same as box 1 on the 1099-INT, i.e., interest income, whether it was received by you or paid by the State of Virginia - in any case, it is to be added to your income as if it were stand-alone 1099-INT.
Remarkably, the State of Virginia states, "To avoid the confusion that may be caused by sending multiple statements for the same tax year, we issue a single statement showing separate refund and interest amounts." One could well wonder if they succeeded.
Now that you know this, please go back and read our responses above and see if you can enter your form correctly.
@snoskiur
@andersn2234
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