How do you calculate MN subtractions?

[mkingsburymn1]

MN subtractions include the standard deduction and what else?

[JohnW152]

There are many subtractions other than standard or itemized deductions, exemptions and the state income tax refund from line 1 of your federal Schedule 1.   

See Line 7—Subtractions from line 35 of Schedule M1M and line 21 of Schedule M1MB on page 15 of the Individual Income Tax Forms and Instructions for a comprehensive listing.

[sbecchet]

I have a 1099-DIV with exempt interest dividends.

A portion of this dividend income can be subtracted from my Minnesota income.

The subtractable portion is interest from bonds related to Minnesota government entities.

I don't see a place in TurboTax enter this subtraction.

Can you help?

[KeshaH]

Subtractions on the state return are for income items that are taxable on the federal return but not taxable on the state return. Since exempt interest dividends are not taxable on the federal return, there would be no subtraction for the state return.

However, if any of your exempt interest dividends are taxable on the state return you'd see an addition. If any of the exempt interest dividends are from investments in other states, that amount is taxable and will be added to your Minnesota return.

[sbecchet]

I misspoke.

How do I indicate to TurboTax how much to reduce the federally tax exempt income carried over to state by the income from bonds of MN.

[IsabellaG]

When you enter your 1099-DIV on the federal side, you will show your federally tax exempt-interest dividends in box 12. Continue two screens and you will see the screen, Tell us more about your exempt-interest dividends. If you earned the dividends in more than one state, check that box, and enter how much came from MN bonds and how much came from elsewhere. 

Then when you prepare your Minnesota return, under Tell Us About Any Income Adjustments, you will see Investment Income Adjustments, and you'll be able to enter the portion of the amount that transferred where less than 95% of the dividends came from MN bonds.