The federal tax exempt interest is not tax free to the state. How do I enter that?

If the interest received was tax exempt on the federal level, but taxable on the state level, you would have to enter your 1099-INT on the federal input screens in TurboTax. 

Please follow these steps to enter your 1099-INT:

1. Open your return.
2. Search for 1099-INT with the magnifying glass tool at the top of the page.
3. Click on Jump to 1099-INT at the top of the search results. 
4. Click on Add a 1099-INT.
5. Put a check mark in the box which states My form has info in other boxes (this is uncommon).
6. Enter your interest in Box 8.
7. Click continue. 
8. Choose your state(s) on the page titled Tell us more about your tax-exempt interest. 

Tax-exempt interest for the states of ME,MD,MA,NH,NJ,TN and WV are treated differently and may not tax all of this interest. Click the appropriate box in the interview screens if this is one of the states you reside in.