Tax-exempt interest

[krazsus]

I have tax-exempt interest from muni bonds and tax-exempt interest dividends from several mutual funds.  I entered everything from my 1099-INTs and 1099-DIVs into TurboTax, also taking account of the OID for tax-exempt.  But when I look at the final 1040 that TurboTax created, the amount on line 2a does not equal the sum of the tax-exempt interest that I get if I total the 1099's.  The number on line 2a is greater than the amount of tax-exempt interest from the 1099-INTs but less than the total if I also add in the tax-exempt amounts from the 1099-DIVs.  The same thing was true for my return from last year (2024), but I was at the deadline and didn't have time to investigate this.  Is there a reason why they might be different?  

[baldietax]

remember to include premium and accrued interest adjustments in your calculations to match 1040 2a.  If your 1040 is coming in lower then it's probably those adjustments which reduce the muni income.

1040 2a should generally be the sum of:

1099-INT Box 8 less Box 13 less accrued interest adjustments.  Note if you have accrued interest adjustments for individual munis and you have other income on the 1099 (Box 1 or 3) you need to split the 1099-INT up otherwise any accrued gets spread across all the boxes not specifically just Box 8 and you'll get the wrong outcome for Fed and State.

1099-OID Box 11 less Box 6 (also Box 10 if your broker uses this).  1099-OID doesn't have separate boxes for premium on munis so if you have different types of bond on the 1099-OID again you may have to split it up.

1099-DIV Box 12.  Should be straightforward for Fed - but State can sometimes have issues with the addition for out of state tax due to a bug in the entry screen if you switch between one or many states, so check that too.