Municipal And State Interest
Municipal and state interest income is tax-free on your Federal tax return. Although you report it for informational purposes, it is not taxed. Municipal interest is also not included as income if the municipal instrument originates from the state you are filing. Out-of-state municipal bonds are not excluded on your state income tax return, only your Federal return.
Note If you need professional help with "Interest Income" or have other tax questions, we can help you find a local licensed CPA for a free, no-obligation consultation.