Question

For my 1099-INT, how do I know what interest is subject to federal tax but not state tax under maryland law? I find the explanation very vague.

Forum|Forum|6 years ago
March 18, 2020
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TurboTax Deluxe Online

The tax exempt interest in the State of Maryland is basically interest earned in any other state. besides Maryland. Here is the explanation from the State of Maryland for the tax exempt interest:

TAX EXEMPT STATE OR LOCAL BOND INTEREST. Enter the interest from non-Maryland state or local bonds or other obligations (less related expenses). This includes interest from mutual funds that invest in non-Maryland state or local obligations. Interest earned on obligations of Maryland or any Maryland subdivision is exempt from Maryland tax and should not be entered on this line.

See State of Maryland Instructions for more detail.

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fanfare

Employee

No wonder you're confused.

Your fund company (assuming it's a fund) will publish the percentage that is Maryland income.
if they don't mail it to you, you have to go online for it.

Multiply your municipal fund income by that percentage to determine what is NOT taxable by your state of Maryland.