a. Add all
dividends from mutual funds, investment trusts, or regulated investment
companies investing in state and municipal bonds.
b. Deduct that
portion of any net dividends from a mutual fund, investment trust, or regulated
investment company that is attributable to Federal securities. You cannot
take this deduction unless you are provided a statement from the fund giving
the percentage of net dividends attributable to Federal securities. A copy
of the statement must be attached to the return to take this deduction.
Interest income from repurchase agreements involving
Federal securities cannot be deducted.