JotikaT2
Employee Tax Expert

State tax filing

It depends.

 

Your state refund will either be fully taxable or even partially taxable depending upon how much the deduction affected your refund or tax liability. 

 

All 3 of the following must be true or the refund to affect your 2020 tax return. 

  • You itemized deductions last year 
  • You claimed state and local income taxes 
  • Claiming the deduction helped you increase your federal refund or lower your tax bill 
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