In 2023, I had state taxes paid on my behalf via a pass-through entity tax (PTET). In 2024, I received a refund of some of these taxes. The taxes definitely reduced my federal tax in 2023, and I'm sure I should pay federal tax on the refunds in 2024 (tax benefit rule). The TurboTax state tax refund worksheet doesn't seem to know how to deal with these. It only uses my 2023 itemized deductions for taxes paid. The PTET wasn't itemized; it just came out of the gross income reported to me.
Does anyone know how to handle this in TurboTax?
