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Level 1
posted Feb 10, 2023 5:28:38 AM

Exempt interest is being taxed in turbo tax

When I add interest on line 13 that should be tax free my refund federal and state, goes down almost as much as if I entered in as qualified interest - talked with support and got nothing more than if it is entered correctly then it is right. There is no other data entered in any other box except the state it was earned in.

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1 Best answer
Level 15
Feb 10, 2023 9:14:42 AM

We're not discussing just any 1099 (there are several different kinds, with entirely different box numbering)...this is for a 1099-DIV !!

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IF you are receiving Social Security, and have a Social Security SA-1099 already entered,  putting $$ into box 12 of a 1099-DIV? .....That WILL make more of your Social Security subject to taxation....up until 85% of the SS is being taxed.

 

Tax-exempt income is included in income for the purposes of determining how much SS is going to get taxed.

 

 

6 Replies
Level 15
Feb 10, 2023 5:36:19 AM

Line 13 of what form?

Level 15
Feb 10, 2023 6:55:41 AM

Box 13 of a 1099-DIV form????

 

Box 13 of that form indicates the sub-portion of box 12 $$ that came from "Private Activity" bonds. Those are bonds for some things, like a City's Professional athletics stadium.  Those $$ do become taxable in some situations.

Level 1
Feb 10, 2023 8:10:59 AM

1099 

 

Level 1
Feb 10, 2023 8:16:01 AM

I am sorry - box 12 of the 1099 - is when the refund drops dramatically there are only a few pennies in box 13.

The amount of tax was $144 if I put the dividend in a qualified and $114 when it was entered into the exempt area (box 12)

Level 15
Feb 10, 2023 9:14:42 AM

We're not discussing just any 1099 (there are several different kinds, with entirely different box numbering)...this is for a 1099-DIV !!

___

 

IF you are receiving Social Security, and have a Social Security SA-1099 already entered,  putting $$ into box 12 of a 1099-DIV? .....That WILL make more of your Social Security subject to taxation....up until 85% of the SS is being taxed.

 

Tax-exempt income is included in income for the purposes of determining how much SS is going to get taxed.

 

 

Level 1
Feb 10, 2023 9:53:03 AM

Thank you, I guess that makes this investment even less attractive.