C Corp US government interest

Technical topics regarding tax preparation.
#1
jon  
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minnesota
Community bank has US Government Interest (C Corp 1120), taxable on the federal how about the State? All qualify munis are tax free on the federal, but taxable on the State(MN), because of a successful court case in another State years ago and the fact that MN has a franchise tax. This is the first year they have had US Government interest, does it apply here?
 

#2
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8155
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4-Mar-2018 9:03pm
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The Office
US government interest can't be taxed by the states by law. It's a subtraction on state returns.
 

#3
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Somewhere out there...
Not the case for banks, check the state rules.
 


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