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If your interest is exempt from New Jersey only:

  1. From within your TaxAct return (Online or Desktop), click Federal (on smaller devices, click in the top left corner of your screen, then click Federal).
  2. Click the Investment Income dropdown, 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 (desktop program: click Review instead of Edit).
  4. Click Step-by-Step Guidance, then continue with the interview process until you reach the screen titled Interest Income - 1099-INT Income.
  5. Enter the New Jersey amount in the field below 3. Interest on U.S. Savings Bonds and Treasury obligations.

The amount you enter will be added to the total interest income on the federal return, and will be included on New Jersey Form NJ-1040, Line 16a or Form NJ-1040NR, Line 16.

If the interest is exempt from Federal Only OR Federal AND New Jersey:

  1. From within your TaxAct return (Online or Desktop), click Federal (on smaller devices, click in the top left corner of your screen, then click Federal).
  2. Click the Investment Income dropdown, 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 (desktop program: click Review instead of Edit).
  4. Click Step-by-Step Guidance, then continue with the interview process until you reach the screen titled Interest Income - Tax-Exempt Interest.
  5. If you have interest that is federally exempt, enter your amount in the field below 8. Tax-exempt interest.
  6. On the screen titled Interest Income - State Tax-Exempt Interest, if you have both federal and state exempt interest, click Yes.
  7. On the second screen titled Interest Income - State Tax-Exempt Interest, enter your amount in the field below Amount from box 8 that is both federal and state exempt interest.

Example of federal and state exempt:

You have $2,000 dollars of total interest, with $1,000 being federally exempt and $300 being New Jersey exempt. Enter $1,000 in Box 1 of Form 1099-INT. The $1,000 that is federally exempt is entered in Box 8. The $300 that is exempt from New Jersey taxes is entered in the Amount from Box 8 that is both Federal and State exempt interest field.

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

  • Form 1040, Line 2a = $1,000
  • Form 1040, Line 2b = $1,000
  • New Jersey Form NJ-1040, Line 16a or Form NJ-1040NR, Line 16 = $1,700
  • New Jersey Form NJ-1040, Line 16b = $300

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