Is interest from U.S. Govt obligations subtracted from NY State income?

Forum|Forum|7 years ago
June 5, 2019
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TurboTax Premier Online

Irene2805

Level 15

No - According to the Internal Revenue Service, any interest earned on a U.S. Treasury bill "is exempt from all state and local income taxes."

If included on your federal return, the interest will be subtracted out of your NYS income on line 28 of the IT-201.

gj16

Level 2

I have interest income on US government bonds that I need to subtract for NYS purposes. It needs to go on line 28 of Form IT 201. I have not found anywhere in the easy step questions that allows me to input this amount and have it wind up on line 28. Under the "changes to federal income/investment adjustments section" the heading of "investment income from US government agencies" does not wind up on line 28 but instead line 31 as other. Do I need to force input this NY subtraction amount for line 28?

VolvoGirl

Level 15

What did you enter them from? A 1099INT? If they are like savings bonds the interest goes in box 3 not box 1. Box 3 will be automatically subtracted on the state return.

gj16

Level 2

Thanks. They are actually dividends from US treasury funds and ETFs that are taxable at the federal level not the state level so they are not separated out on the 1099DIV. I need to back them out on the NY subtraction but the TT interview doesn't ask this specifically.