Interest on federal obligations

Forum|Forum|5 years ago
February 24, 2021
1 reply
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Where is interest on federal debt obligations deducted from my federal adjusted gross income to compute my Minnesota adjusted gross income?

JohnW152

Level 15

This interest is reported as a subtraction on line 18 of Schedule M1M, Income Additions and Subtractions, then carried to line 7 of Form M1, Individual Income Tax.

fredf006Author

Level 2

I understand that the deduction from Minnesota State AGI for interest on federal debt is accomplished through form M1M. My question is, "How do I tell TurboTax that the income on a form 1099-INT is interest on Federal Debt so that it generates the entry on form M1M?" I used the TurboTax Premier tax interview and never saw that it asked for that information and it never generated form M1M.

DianeW777

Level 15

The entry is generated from Form 1099-INT by an entry in Box 3, Interest from US savings bonds and Treasury obligations. Once an entry is populated in that box, then it is auto-generated in the Minnesota (MN) tax return. It will show up on the Adjustments Summary page.

If your 1099-INT does not have an entry in Box 3, then it would indicate this interest does not qualify for the tax-free treatment on the MN state return. It is not a direct entry on the MN return when there is no amount populated in the Box 3 slot.

An example of the MN page is shown below.