US TREASURY BOND DISCOUNT IS NOT PICKED UP AS EXCLUDED INTEREST ON MY MASSACHUSETTS TAX RETURN
I purchased Treasuries on the secondary market at a discount. The financial institution reports interest paid on a 1099 INT Form. The discounts appeared on Form 1099 B. The federal return dictates recording the discounts on a gain and loss schedule. The gain is them reported on Schedule B as Interest. When the data is transferred to the State return, only the amount on the 1099 INT appears on the Other Interest and Dividends Excluded Statement. This leaves me with a large sum reported as taxable income at the State level when it should be excluded. How do I fix this when all of the information reported at the Federal level is correct?