Us government obligations

Forum|Forum|6 years ago
June 5, 2019
1 reply
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When doing my federal taxes, I entered the amount of my dividends that were from US Government obligations. When I go to the state portion of my taxes, how do I know that it took? They have a section in the state (Michigan) about Capital Gains, but that isn't part of the US Gov't Obligation calculation. If I entered the amount of my dividends that was from US Gov't Obligations in the federal section, do I need to enter it again in the state section?

TurboTax Deluxe Windows

Best answer by Cindy0H

No, you do not need to enter it again. In most states, mutual fund dividends from interest on direct U.S. government securities are exempt from state and local taxes.

The following U.S. Obligations are exempt from Michigan Individual Income Tax:

U.S. Government Bonds U.S. Savings Bonds – Series E, F, G and H U.S. Government Certificates U.S. Treasury Bills and Notes

Cindy0HAnswer

Employee

No, you do not need to enter it again. In most states, mutual fund dividends from interest on direct U.S. government securities are exempt from state and local taxes.

The following U.S. Obligations are exempt from Michigan Individual Income Tax:

U.S. Government Bonds U.S. Savings Bonds – Series E, F, G and H U.S. Government Certificates U.S. Treasury Bills and Notes

chrob61Author

Hello- I have Turbo Tax Premier, and it imported my 1099-DIV from Fidelity. However, when I was in the state filing section, it shows "this is what we've reported so far" and it was only the capital gain from a mutual fund sale- NO dividends at all! The percentage of the reduction for US govt based obligations should be on the dividends NOT the capital gains. Can this glitch in the program be fixed??

Nancy K

After many hours and much frustration and study, I have found that the way you must enter dividends from US obligations on TTX is to call them interest. I got a supplemental information sheet from my investment company that shows the percent US income in the investment I own. I had to manually calculate the amount that my state does not tax. At some point in the step by step TTX does ask if any of your interest is from US obligations. TTX does not handle dividends from US obligations. You have to treat your US dividends as US interest. That way it will be handled correctly on both your federal and your state income tax. It is my understanding that no states tax this kind of income. This is a problem that should be fixed by the TTX people. It is a bug in the programming. It is very confusing, especially if you are keying everything in on your 1099s as printed.