1099G question

Hi,

 

I filed state taxes in Michigan last year and initially paid several hundred dollars with my state return.

 

Later on, after I received a new K1, I filed an amended return, on which I got a refund of a small portion of that money -- $66.

 

I have now received a "Substitute Form 1099-G" for the $66.

Should I be paying Federal Taxes this year on the $66, even though it was far less than my initial State Tax payment? Note, I did not itemize.