If I've determined the refund is not taxable (itemized, but due to AMT adjustments, the benefit was nullified), my question is ...precisely what should I enter in TurboTax? In the past, I thought I entered the 1099-G exactly, and then there was another field for me to report how much of that value is taxable. This answer hints that you simply don't enter anything for the 1099-G and just keep it for my records. I liked the old method, so that I could show I had properly accounted for the refund and determined it not-taxable. Not entering it may cause IRS to assume I just forgot about it and trigger some review. What is the right method today for entering a non-taxable 1099-G state tax refund? No entry? or Enter-and-adjust-to-zero?
