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marks818
Level 2

Why is the Wisconsin-specific interest included in Wisconsin state tax form?

On my Wisconsin state form Schedule AD, the State and Municipal Interest is not being reduced by the Wisconsin-specific interest earned. The Smart Worksheet shows the correct number on line a) (Interest earned on Wisconsin state and municipal obligations), but it shows 0 for line b), (Wisconsin state and municipal obligations exempt from both federal and Wisconsin tax), which is the "exempt" amount. How do I reduce the State and Municipal interest by the Wisconsin-specific interest that was earned?
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Accepted Solutions
marks818
Level 2

Why is the Wisconsin-specific interest included in Wisconsin state tax form?

Under the Income section of the Wisconsin state form, TurboTax has this option:  "WI Interest from State and Municipal Obligations".  This option listed the correct dollar amount in the margin, but did not apply it by reducing the income by that amount.  I discovered that one has to click on the Edit button for that option and then type in the amount that is deductible.  By default, TurboTax assumes $0 is deductible.  Once I entered the correct amount, the income total reduced by that amount.

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3 Replies
DaveF1006
Employee Tax Expert

Why is the Wisconsin-specific interest included in Wisconsin state tax form?

After reviewing this Turbo Tax link, I see where you should be able to click in the brown area and line B. This will allow you to correct the exempt amount. This is an allowable adjustment to make directly into the worksheet.

 

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marks818
Level 2

Why is the Wisconsin-specific interest included in Wisconsin state tax form?

Is it a bug in the online TurboTax software that the exempt amount wasn't filled out automatically?  Or did I do something incorrectly when I entered the information which caused the issue?

 

How do I modify the "brown area" that was mentioned?  I found out about the "Smart Worksheet" by downloading a copy of my tax forms along with the worksheets to my local drive and looking at the results.  So I was not accessing the Smart Worksheet through TurboTax directly.  Thanks.

marks818
Level 2

Why is the Wisconsin-specific interest included in Wisconsin state tax form?

Under the Income section of the Wisconsin state form, TurboTax has this option:  "WI Interest from State and Municipal Obligations".  This option listed the correct dollar amount in the margin, but did not apply it by reducing the income by that amount.  I discovered that one has to click on the Edit button for that option and then type in the amount that is deductible.  By default, TurboTax assumes $0 is deductible.  Once I entered the correct amount, the income total reduced by that amount.

View solution in original post

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