Do I have to pay tax on my state tax refund?
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| If you itemized tax deductions on your
tax return for a prior tax year and
previously deducted state tax or local tax, and subsequently received a tax refund of some or all of
the state tax or local tax that you deducted, you should include the tax refund as
taxable income on your current year tax return. Enter the amount of your previously deducted state
tax or local tax refund on Line
10 of Form 1040. If you did not itemize your tax deductions on your tax return for the
same tax year as the state tax refund or local tax refund, do not report any of the tax refund as
taxable income on your tax return. |
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Related tax
information about a tax refund |
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| Income Related Questions and Answers |
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IRS publications about a tax refund:
For further tax information about a tax refund see Tax
Topic 405, Refund of State and Local Taxes, and
IRS Publication 525, Taxable and
Nontaxable Income, for further information. Also see
IRS Publication 17, Your Federal
Income Tax. |
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Ask Julian Block your IRS and tax questions! |
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If you can't find the answer to your IRS or tax question in our
web you can call former IRS Special Agent and one of the country's foremost tax attorneys, nationally syndicated columnist ("The Tax
Adviser") Julian Block. Julian is also the tax Editor of Mutual Funds Magazine, America's premier investment magazine. To
call Julian for a tax consultation click
here. |
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