US Savings bond interest is exempt from state and local taxes. In TaxSlayer ProWeb, when you enter the Form 1099-INT that includes this interest you will also indicate the taxpayer's resident state tax return for the purpose of subtracting the interest from the state return's taxable income calculation.
To enter US Savings Bond interest and indicate the state exemption in TaxSlayer ProWeb, from the Federal Section of the tax return select:
- Income
- Schedule B - Forms 1099-INT, DIV, OID
- Interest or Dividend Income - If this is not the first 1099-INT, DIV, or OID you've entered into Schedule B, select + Add Interest and Dividends.
- Select Interest Income, Form 1099-INT, (including interest income < 1,500).
- Enter the payer name (EIN and address are optional).
- Enter the amount of savings bond interest in Box 3.
- Scroll down, looking for the field labeled Amount of Interest on U.S. Savings Bonds and Treasury Obligations that you want subtracted from your state return, and enter the same amount there.
- In the drop down menu select the state for the taxpayer's resident return that this amount will be subtracted from.
Additional Information: