Hi,
In 2020, I received a relocation allowance from my employer, which I had reported as income and paid both Fed and California income tax on that allowance back in 2020. In 2023, I have to pay back this allowance to my employer. As I am taking standard deduction for my 1040, I entered a tax credit for the tax that I paid back in 2020 in my 2023 Schedule 3 Line 13b.
To reclaim the tax that I had back in 2020 in my 2023 California tax return, do I just enter the relocation allowance ($10K in this case) to Schedule CA Part I Line Z Column B and label it as "IRC1341 Relocation Repayment"? It looks this number will then show up in Form 540 Line 14 as an Income Adjustment amount.... I am hoping to get a confirmation from this Community if my thinking process is correct?
I do know the exact State tax that I had paid in 2020 for that relocation allowance, but from looking at Schedule CA, it seems that I enter full amount received (to adjust income) and not just enter the tax amount paid.
Thank you
-Steve
