How do I know if interest income is exempt from state tax?

[Anonymous]

I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

[Anonymous]

Use TurboTax

[Anonymous]

Anonymous wrote:Use TurboTax

Well TurboTax asked me if it is or not so I have to tell it something.

[Anonymous]

Ask on bogleheads

[Anonymous]

Anonymous wrote:I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

I have some of my cash in VUSXX at Vanguard- their Treasury money market fund, I am sure pretty similar to FDLXX. My 1099-DIV is 6 pages, and page 4 says "Mutual Fund and UIT Supplemental Information". Here is the important section:

"VNGRD TRSY MMKT INVS / / VUSXX
PERCENTAGE OF INCOME FROM US GOVERNMENT SECURITIES
Fed Source Total 80.06% (A detailed breakdown is shown below when available)
Agency % Agency % Agency %
U.S. Treasury 80.06 Fed Farm Credit 0.00 TN Valley Auth 0.00
Fed Home Loan 0.00 Student Loan 0.00 Other Dir. Fed 0.00"

The formatting doesn't come through well, but that's saying 80.06% of the fund is invested in US Treasuries. That is the info you need to put into your tax software when entering the 1099-DIV info.

[Anonymous]

There will be a supplemental sheet showing the % attributed to each state. Often it's low like 1%, so I foudn doing the calculations to properly report it wasn't worth the hassle.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

I have some of my cash in VUSXX at Vanguard- their Treasury money market fund, I am sure pretty similar to FDLXX. My 1099-DIV is 6 pages, and page 4 says "Mutual Fund and UIT Supplemental Information". Here is the important section:

"VNGRD TRSY MMKT INVS / / VUSXX
PERCENTAGE OF INCOME FROM US GOVERNMENT SECURITIES
Fed Source Total 80.06% (A detailed breakdown is shown below when available)
Agency % Agency % Agency %
U.S. Treasury 80.06 Fed Farm Credit 0.00 TN Valley Auth 0.00
Fed Home Loan 0.00 Student Loan 0.00 Other Dir. Fed 0.00"

The formatting doesn't come through well, but that's saying 80.06% of the fund is invested in US Treasuries. That is the info you need to put into your tax software when entering the 1099-DIV info.

Thank you, this was helpful. I did a search for "government securities" on my 1099 and apparently Fidelity lists this information separately. In case anyone else is wondering, you have to go here to find it: https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/TY23-GSE-Supplemental-Letter.pdf

SPAXX is not listed so I assume that is zero. My FDLXX is 90% from U.S. government securities so that is good to know.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

I have some of my cash in VUSXX at Vanguard- their Treasury money market fund, I am sure pretty similar to FDLXX. My 1099-DIV is 6 pages, and page 4 says "Mutual Fund and UIT Supplemental Information". Here is the important section:

"VNGRD TRSY MMKT INVS / / VUSXX
PERCENTAGE OF INCOME FROM US GOVERNMENT SECURITIES
Fed Source Total 80.06% (A detailed breakdown is shown below when available)
Agency % Agency % Agency %
U.S. Treasury 80.06 Fed Farm Credit 0.00 TN Valley Auth 0.00
Fed Home Loan 0.00 Student Loan 0.00 Other Dir. Fed 0.00"

The formatting doesn't come through well, but that's saying 80.06% of the fund is invested in US Treasuries. That is the info you need to put into your tax software when entering the 1099-DIV info.

Thank you, this was helpful. I did a search for "government securities" on my 1099 and apparently Fidelity lists this information separately. In case anyone else is wondering, you have to go here to find it: https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/TY23-GSE-Supplemental-Letter.pdf

SPAXX is not listed so I assume that is zero. My FDLXX is 90% from U.S. government securities so that is good to know.

Take a closer look, I think it may there in a "pack"

Fidelity® Government Money Market Fund - All Classes* Various 41.18%

It's really unfortunate that they can't just pull this info out and include it in your 1099 package like Vanguard does.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

I have some of my cash in VUSXX at Vanguard- their Treasury money market fund, I am sure pretty similar to FDLXX. My 1099-DIV is 6 pages, and page 4 says "Mutual Fund and UIT Supplemental Information". Here is the important section:

"VNGRD TRSY MMKT INVS / / VUSXX
PERCENTAGE OF INCOME FROM US GOVERNMENT SECURITIES
Fed Source Total 80.06% (A detailed breakdown is shown below when available)
Agency % Agency % Agency %
U.S. Treasury 80.06 Fed Farm Credit 0.00 TN Valley Auth 0.00
Fed Home Loan 0.00 Student Loan 0.00 Other Dir. Fed 0.00"

The formatting doesn't come through well, but that's saying 80.06% of the fund is invested in US Treasuries. That is the info you need to put into your tax software when entering the 1099-DIV info.

Thank you, this was helpful. I did a search for "government securities" on my 1099 and apparently Fidelity lists this information separately. In case anyone else is wondering, you have to go here to find it: https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/TY23-GSE-Supplemental-Letter.pdf

SPAXX is not listed so I assume that is zero. My FDLXX is 90% from U.S. government securities so that is good to know.

Take a closer look, I think it may there in a "pack"

Fidelity® Government Money Market Fund - All Classes* Various 41.18%

It's really unfortunate that they can't just pull this info out and include it in your 1099 package like Vanguard does.

Thank you again, that is really helpful. Agree, it would be helpful and easy for them to include this on the 1099.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I received a 1099 from Fidelity for some interest and I am curious how I know if it is exempt from state income taxes?

The ticker symbols are:

SPAXX - Fidelity Government Money Market (I suspect this is not tax exempt)
FDLXX - Fidelity Treasury Only Money Market FD (not sure about this one, I thought it invested in short-term treasuries but I don't know).

In theory it should show up on one of the boxes of the 1099 right? If so, which one?

I have some of my cash in VUSXX at Vanguard- their Treasury money market fund, I am sure pretty similar to FDLXX. My 1099-DIV is 6 pages, and page 4 says "Mutual Fund and UIT Supplemental Information". Here is the important section:

"VNGRD TRSY MMKT INVS / / VUSXX
PERCENTAGE OF INCOME FROM US GOVERNMENT SECURITIES
Fed Source Total 80.06% (A detailed breakdown is shown below when available)
Agency % Agency % Agency %
U.S. Treasury 80.06 Fed Farm Credit 0.00 TN Valley Auth 0.00
Fed Home Loan 0.00 Student Loan 0.00 Other Dir. Fed 0.00"

The formatting doesn't come through well, but that's saying 80.06% of the fund is invested in US Treasuries. That is the info you need to put into your tax software when entering the 1099-DIV info.

Thank you, this was helpful. I did a search for "government securities" on my 1099 and apparently Fidelity lists this information separately. In case anyone else is wondering, you have to go here to find it: https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/TY23-GSE-Supplemental-Letter.pdf

SPAXX is not listed so I assume that is zero. My FDLXX is 90% from U.S. government securities so that is good to know.

Take a closer look, I think it may there in a "pack"

Fidelity® Government Money Market Fund - All Classes* Various 41.18%

It's really unfortunate that they can't just pull this info out and include it in your 1099 package like Vanguard does.

Thank you again, that is really helpful. Agree, it would be helpful and easy for them to include this on the 1099.

Sure thing. If you look at the fund page right now, looks like its around 30% US government securities, so being at 41% for all of 2023 sounds within reason.

https://fundresearch.fidelity.com/mutual-funds/composition/31617H102

My limited understanding is that these money markets traditionally have been primarily US treasuries directly, so traditionally were mostly state tax exempt. As rates have risen so much in the last 2 years, and more money has flowed into money market funds, they have been seeking higher yields/interest rates, and repo agreements generally off slightly higher rates, but with the same underlying security. So these funds have shifted a significant percentage of their holdings into repo agreements, which are state taxable (because they aren't directly holding government securities- they are holding a loan backed by government securities). That's why I specifically sought out VUSXX as opposed to Vanguard's "Standard" money market sweep fund. The rate is slightly lower, but being in DC we have a pretty high "state" rate, so the net rate is higher with VUSXX. I bet you will see the same with FDLXX if you do the math, although it does depend on your state rate.