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How To Obtain Your State Income Tax Exemption From Vanguard Money Market Funds

RichardW
  |     |   819 posts since 2019

Here is a useful article by Jonathan Ping of MyMoneyBlog.com which explains how to deal with your state income tax exemption from money market funds which had a portion of their income derived from U.S. government obligations in tax year 2024. The author utilizes the Vanguard money market funds VMFXX and VUSXX in his explanation. https://www.mymoneyblog.com/vanguard-federal-money-market-fund-claim-state-income-tax-exemption.html

The money market fund information for tax year 2024 from Fidelity has not yet been released. It is typically posted by Fidelity in mid-February. When it is posted it should be available here: https://www.fidelity.com/tax-information/fidelity-mutual-fund-tax-information

Additional state income tax exemption information regarding Vanguard money market funds which had a portion of their income derived from U.S. government obligations in tax year 2024 can be found in this 1/22/2025 DA post: https://www.depositaccounts.com/community/misc/60141-money-market-fund-dividend-income-tax-year-2024...

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CDMD
  |     |   142 posts since 2022
One point of clarification on the article link. The author suggests he doesn’t know if the tax software assists the taxpayer user with the state tax benefit on their return. I can tell you TurboTax does guide you through this process. You just have to be very attentive to check the right boxes and fill in the right information in the right boxes. And you need the fund in question proper disclosure document on the % of funds in govt securities to document your claim in case or when you get audited.
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