Where do I report a refund of student loan interest previously deducted? I also need to make sure the software doesn't count this as income on my state return.

Here's how to enter the refund in TurboTax so that it will be reported on Schedule 1 line 8z with a description that you enter.

• In the Search box in TurboTax type "lawsuit settlement" (without the quotes), then click the link that says "Jump to lawsuit settlement." I know that's not what the refund was for, but it's the only search term I could find that gets you to the right place.
• The first screen asks, "Any Other Taxable Income?" Click Yes.
• On the next screen, "Other Taxable Income," enter a short description such as "Refund of student loan interest previously deducted" and enter the amount. Click Continue.
• On the next screen click Done.

Every state has different forms. If you tell us what state you are in, someone who is familiar with that state might be able to help you with the state.

In the income section of TurboTax scroll all the way down to "Other Income".  Enter the amount and "Student Interest Refund" as a description.

When you're doing your state return the system will give you a chance to exclude any income that isn't taxable at the state level.  

@iEngineer