Multi State: Interest income being attributed to both states

Hello,

I am filing a tax return in both NY and NJ. I work in NY and live in NJ.

It is my understanding that interest income should be allocated and taxed in the state where I reside, in this case NJ. So let's say I have $100 in interest income. I pay NJ tax on that $100, but the $100 should be exempt from NY taxes. Is this correct?

In turbotax, the interest income is being included in my New York adjusted gross income. I am going through the income allocation steps on my NY return and attributing $0 of interest income to NY. However, these amounts are not deducted from my NY taxable income in the end.

How do I fix this?

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