Keep it with your tax records. The IRS has stated you can exclude payments considered General Welfare and disaster relief payments from your federal return. The CA Middle-Class Tax Refund issued in 2022 is considered one of these payments.
The MCTR payment is not taxable for California state income tax purposes. You do not need to claim the payment as income on your California income tax return either. But you should keep the document with your tax records. @jsquick
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