The tax exempt interest in the State of Maryland is basically interest earned in any other state. besides Maryland. Here is the explanation from the State of Maryland for the tax exempt interest:
TAX EXEMPT STATE OR LOCAL BOND INTEREST. Enter the interest from non-Maryland state or local bonds or other obligations (less related expenses). This includes interest from mutual funds that invest in non-Maryland state or local obligations. Interest earned on obligations of Maryland or any Maryland subdivision is exempt from Maryland tax and should not be entered on this line.
See State of Maryland Instructions for more detail.
No wonder you're confused.
Your fund company (assuming it's a fund) will publish the percentage that is Maryland income.
if they don't mail it to you, you have to go online for it.
Multiply your municipal fund income by that percentage to determine what is NOT taxable by your state of Maryland.
I live in MD. I see that Capital Gains from US Obligations are Tax Free?
Can someone explain???
Am I exempt from 2018 MD return? Am I exempt from my local credit unions or banks 1099-INT?
Thanks