Is my 2016 state tax refund reportable and taxable even though the entire amount was taken by the state to pay back taxes?

[shepherm]

I did not receive any portion of my Federal or State "refunds." They were kept to pay back taxes. So is the 2016 state "refund" taxable?

[CapB · Accepted solution]

Yes, the taxability of your 2016 refund is not determined based on your 2016 refund being used as a refund-offset to pay state back taxes; the taxability of your 2016 refund is based on the following (whether or not there was a refund-offset): 

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