Trouble Reporting Exempt-Interest Dividends by State in TurboTax

[P_SK]

I’m encountering an issue while reporting exempt-interest dividends in TurboTax Home and Business. I’ve calculated the dividends by state using the percentage breakdown from iShares and double-checked the numbers, ensuring they add up correctly. However, TurboTax is flagging the information as incorrect.

Has anyone else faced a similar problem? Is there a specific way to correctly report exempt-interest dividends by state in TurboTax that I might be overlooking?

[robtm]

Not sure how you're entering state tax-free dividends but when you enter 1099-div and indicate you have tax-free dividends a few screens later on tt will ask you how much of the dividend belongs to your state. You select your state from the dropdown box  and enter the amount of  dividend attributed to it. The balance of the dividend would be entered as Multiple States. Do this for each 1099 you have tax-free dividends on.

[P_SK]

Thank you for your suggestion! I’ve been following that process, but the issue is that the 2024 iShares National Muni Bond exempt-interest dividends are distributed across nearly every state. Since the dividends are spread across multiple states, I’m finding it difficult to enter them correctly in TurboTax. I’ve already calculated the amounts for each state based on the iShares breakdown, but TurboTax flags it as incorrect when I input the state-specific figures.

Do you have any recommendations for handling this situation when the dividends come from so many states? Is there a more efficient way to report the information in TurboTax?

[P_SK]

Issue resolved!

[MK1947]

I have the same problem entering amounts for each state when there are 20 states and I've determined the % of the amount that should be entered for each.  TT says that the numbers don't add up when I have a spreadsheet that says that they do add to the Exempt Interest Dividends.

[baldietax]

probably some rounding errors, but you don't need to enter all the states, just

1. your home state

2. US possessions (e.g. Puerto Rico) if your state treats as exempt

3. Whatever % is left you can enter as 'multiple states' which is a catch-all for anything taxable in your home state

[MK1947]

Thank you.  I need to relook Puerto Rico, since I didn't differentiate it from "Other States.".