I am doing my Dad's taxes, and he has (perhaps) a unique situation. He received a state tax refund for his 2017 tax return. In addition, he also paid estimated state taxes in the first quarter of 2018, before the deadline, so they were not deductible on his 2017 federal return. How do I determine if the 2017 state tax refund is taxable? Normally, it would be taxable, since he did itemize deductions in 2017 - but due to the Q4 '17 state estimated taxes not being deducted, how do I calculate the taxable amount of this refund, and how do I claim the estimated taxes paid in early 2018 for tax year 2017? Thanks in advance.
