https://ttlc.intuit.com/community/taxes/discussion/why-doesn-t-adjusting-dividends-for-us-government-interest-change-my-tax/01/378345#M156821 <P>I have adjusted dividends earned from mutual funds by the amount of US government interest earned by those funds and it does not have any impact on my tax owed.&nbsp; I thought US government interest was federal tax free.</P> Tue, 04 Jun 2019 00:30:35 GMT rgf283 2019-06-04T00:30:35Z https://ttlc.intuit.com/community/taxes/discussion/why-doesn-t-adjusting-dividends-for-us-government-interest-change-my-tax/01/378345#M156821 <P>I have adjusted dividends earned from mutual funds by the amount of US government interest earned by those funds and it does not have any impact on my tax owed.&nbsp; I thought US government interest was federal tax free.</P> Tue, 04 Jun 2019 00:30:35 GMT https://ttlc.intuit.com/community/taxes/discussion/why-doesn-t-adjusting-dividends-for-us-government-interest-change-my-tax/01/378345#M156821 rgf283 2019-06-04T00:30:35Z https://ttlc.intuit.com/community/taxes/discussion/no-that-amount-might-only-affect-your-state-taxes-no/01/378348#M156822 No....that amount might only affect your state taxes...not federal.<BR />It's the states that do not tax Federal interest from US Bonds.<BR /><BR />And even then it may depend on the size of the $$ adjustment amount&nbsp;&nbsp;(5% of $20 is only $1 of state tax saved) Tue, 04 Jun 2019 00:30:37 GMT https://ttlc.intuit.com/community/taxes/discussion/no-that-amount-might-only-affect-your-state-taxes-no/01/378348#M156822 SteamTrain 2019-06-04T00:30:37Z