If your state has an income tax, they do not tax interest received from US Govt Bonds.
BUT, a mutual fund reports dividends from stocks it holds, plus total bond interest received from both Corporate and US Govt Bonds...all together in box 1a of a 1099-DIV form.
SO, if you want to attempt to lower the the taxes a state assesses on the box 1a $$, you can (but do not have to) break out the sub $$ amount of box 1a that came specifically from US Govt Bonds. And YES, you do have to calculate the proper amount yourself, from the supplemental information the Fund company provides separately. (sometimes it's a waste of time to do so...unless some of your holdings contained a significant portion of US Govt Bonds that generated a lot of US Govt interest).
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Example: say one of my funds issued a total of $1000 of dividends...those are added into box 1a with all the other dividends/interest from other Mutual funds I owned. AND if the fund company tells me that 2% of that $1000 came from US Govt bonds...that's $20, and if I break that out, I save $1 in state taxes (since my state taxes income at ~5%).
Then you can repeat that for any other Funds that reported US Govt interest, and add it to the total US Govt Interest amount.
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How do you break it out if you choose to do so?
1) Well, first you calculate the total $$ from US Govt bonds....for any funds that feed into that 1099-DIV form.
2) Then you fill out the 1099-DIV exactly as the Fund company did (You do not change anything on the main form)
3) Then you Continue to the next pages....one has you check a box " A portion of these dividends is U.S. Government interest."
4) Then on another page the software will ask you to enter the total $$ that you calculated as coming from US Govt bonds. Then, that $ amount will be removed from your State income on your state forms.