If you itemized your deductions in the previous year, all or some of your prior year state income tax refund may be considered taxable income on this year's Federal tax return (Schedule 1 (Form 1040) Additional Income and Adjustments to Income, Line 1). If you claimed the standard deduction, the state refund is not taxable.
To enter the state tax refund, go to our State Tax Refund - Received in Current Year for Last Year's State Return FAQ.
If you had a balance due with your 2022 state income tax return or made a 2022 state or local estimated tax payment after December 31, 2021, this may be deductible on Schedule A (Form 1040) Itemized Deductions, Line 5.
To enter state or local taxes paid, go to our State and Local Taxes - Paid FAQ.
Prior year Federal tax refunds (and payments) are not taxable (or deductible) on the current year's Federal income tax return. However, please check with your state to determine if this information needs to be reported anywhere on your current year state tax return.
Note that any link in the information above is updated each year automatically and will take you to the most recent version of the webpage or document at the time it is accessed.
