Updated October 24, 2026. Quick answer: Line 20 of the New York Form IT-201 is the first New York addition. It asks about interest from the bonds of states other than New York, including certain fund income. If the answer is No, you go to line 21. If Yes, you enter the interest that was not in your federal adjusted gross income, and the amount is added in the New York additions block.
What this line does
The form’s line 20 label reads “Interest income on state and local bonds and obligations (but not those of NYS or its local governments)”, and it is the first line under the heading “New York additions” on page 2. The booklet’s instruction heading is “Line 20: Interest income on state and local bonds and obligations”.
It opens with a question: “Do you have interest income from state and local bonds and obligations from states other than New York State or its local governments?” For how New York treats interest and dividends in general, see whether New York taxes dividends and interest.
Who it applies to
The condition is the question itself, and the booklet gives both answers: “If No, go to line 21.” and “If Yes, enter any such interest income that you received or that was credited to you during 2025 that was not included in your federal adjusted gross income.”
The booklet then lists what the interest includes: “state and local bonds,” “interest and dividend income from tax-exempt bond mutual funds, and” “tax-exempt money market funds that invest in obligations of states other than New York.”
What the instructions say
| Line | What the form says |
|---|---|
| The question | “Do you have interest income from state and local bonds and obligations from states other than New York State or its local governments?” |
| If No | “If No, go to line 21.” |
| If Yes | “If Yes, enter any such interest income that you received or that was credited to you during 2025 that was not included in your federal adjusted gross income.” |
| Included: bonds | “This includes interest income on:” “state and local bonds,” |
| Included: mutual funds | “interest and dividend income from tax-exempt bond mutual funds, and” |
| Included: money market funds | “tax-exempt money market funds that invest in obligations of states other than New York.” |
| Bond bought between interest dates | “If you purchased a bond between interest dates, include the amount of interest you received during the year, after subtracting the seller’s accrued interest” |
| Bond sold between interest dates | “If you sold a bond between interest dates, include the amount of interest you received during the year plus the accrued interest amount” |
| Premium amortization | “For purposes of this addition, bond premium amortization is not allowed as a direct offset to interest income.” |
| Premium: business | “as a subtraction modification on Form IT-225” “if the bond premium is attributable to a trade or business, or” |
| Premium: not business | “as an itemized deduction addition adjustment on Form IT-196, line 44” “if the bond premium is not attributable to a trade or business, but only if you itemize.” |
The booklet adds that the bond purchase and sale paragraphs apply to the amount of interest you received during the year, and the premium paragraph says where a bond premium is reported instead. The premium sub-rules are printed as two bullets under the sentence “You must report it:”.
Where the result goes next
The amount you enter is part of the additions block. The form’s line 24 reads “Add lines 19 through 23”, which brings line 19 and the additions on lines 20 to 23 together. The booklet puts this in context: “New York State taxes certain items of income not taxed by the federal government. You must add these New York additions to your federal adjusted gross income.”
The Step 4 chart in the booklet pairs a modification code with this line: “Interest income on state and local bonds and obligations” is listed under code EA-113 for partnership and S corporation income. For the federal numbers, see Form 1040 lines 2a and 2b, and for the retirement picture see New York retirement taxes. The run of lines is on New York Form IT-201 line by line.
Edition and line numbers
This page reads Form IT-201-I, Instructions for Form IT-201, Resident Income Tax Return (2025), New York State Department of Taxation and Finance, and Form IT-201, Resident Income Tax Return (2025), New York State Department of Taxation and Finance, for tax year 2025, the current file the New York State Department of Taxation and Finance served on 2026-10-24. Check the edition printed on your own form and use that edition’s line numbers.
Common mistakes
- Skipping the line when the bonds are from another state. The question covers “states other than New York State or its local governments”
- Netting a bond premium against the interest. The booklet says “bond premium amortization is not allowed as a direct offset to interest income.”
- Ignoring fund income. The booklet includes “interest and dividend income from tax-exempt bond mutual funds, and”
Related: whether New York taxes dividends and interest, Form 1040 lines 2a and 2b, and New York retirement taxes.
Find the right next step for your situation
About how much do you have invested? Pick the range that fits; your next step appears immediately below.
Talk to an advisor about retirement tax planning
For U.S. investors with $250,000 or more in investable assets. WiserAdvisor is an independent service matching you with 2 to 3 vetted advisers. Its form asks for your ZIP code and answers to a few questions; a match is not guaranteed.
Free to request, with no obligation to hire. By submitting, you consent to calls, texts and emails from WiserAdvisor and up to three advisers. Advisers pay for introductions.
Clear Money Guide may earn a referral payment for a qualifying completed form. An introduction is not a Clear Money Guide recommendation.
Opens on WiserAdvisor’s site in a new tab.
Explore advisor help with bond and interest taxes
Price the destination before you decide. The matching service below introduces you to advisers who pay to meet you.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide may earn a referral payment for a qualifying submitted form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
The Kapitalwise form opens here; you stay on this page.
What happens when you press the button
It asks about nine questions: age, investable assets, location; then your name, email and phone number, and verifies the phone by text. Nothing loads and nothing reaches Kapitalwise until you press the button.
Prefer flat-fee or hourly pricing instead? Compare ranges here.
Answer againSources
- Form IT-201-I, Instructions for Form IT-201, Resident Income Tax Return (2025), New York State Department of Taxation and Finance: www.tax.ny.gov
- Form IT-201, Resident Income Tax Return (2025), New York State Department of Taxation and Finance: www.tax.ny.gov
- Related official page (not quoted): New York State Department of Taxation and Finance, personal income tax forms and instructions page: www.tax.ny.gov
Read from the state revenue documents linked above on October 24, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the state revenue department is the right place to confirm anything consequential.