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If your interest is exempt from New York only:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Investment Income in the Federal Quick Q&A Topics menu to expand, then click Interest income (Form 1099-INT).
  3. Click + Add Form 1099-INT to create a new copy of the form or click Edit to review a form already created.
  4. Click Quick Entry to scroll down to answer all applicable questions or click Step-by-Step Guidance to proceed with the program interview questions.
  5. On the screen titled Interest Income - 1099-INT Income, enter the amount of your New York State exempt interest as 3. Interest on U.S. Savings Bonds and Treasury obligations, then click Continue.

The amount you enter in Box 3 will be added to the total interest income on the federal return, and will be entered on New York Form IT-201, Line 28 or Form IT-203, Line 27.

If the interest is exempt from Federal only OR both Federal AND New York:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Investment Income in the Federal Quick Q&A Topics menu to expand, then click Interest income (Form 1099-INT).
  3. Click + Add Form 1099-INT to create a new copy of the form or click Edit to review a form already created.
  4. Click Quick Entry to scroll down to answer all applicable questions or click Step-by-Step Guidance to proceed with the program interview questions.
  5. On the screen titled Interest Income - Tax-Exempt Interest, if you have interest that is FEDERALLY EXEMPT, enter this amount as 8. Tax-exempt interest, then click Continue.
  6. On the screen titled Interest Income - State Tax-Exempt Interest, if you have FEDERAL AND STATE EXEMPT interest, click Yes.
  7. On the second screen titled Interest Income - State Tax-Exempt Interest, enter the Amount from box 8 that is both federal and state exempt interest, then click Continue.

Example for Federal and State exempt:

You have $2,000 dollars of total interest, with $1,000 being federally exempt and $300 being New York State exempt. Enter $1000 in Box 1 of the Form 1099-INT Interest Income. The $1000 that is federally exempt would be entered in Box 8. The $300 that is exempt from New York State taxes would be entered as the "Amount from Box 8 that is both Federal and State exempt interest."

In this example, the following interest income would be reported on the federal and New York State returns:

  • Form 1040, Line 2a = $1,000
  • Form 1040, Line 2b = $1,000
  • New York Form IT-201, Line 20 or Form IT-203, Line 20 = $700

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.


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