It is paid in the year that you received the refund. It is not prepaid.
If your 2016 state tax return, which you filed in 2017, showed a refund, and you applied that refund to your 2017 state income tax, that is considered paid in 2017 and would be included in your itemized deduction for state income tax on your 2017 federal tax return. That deduction on your 2017 federal tax return is not capped by the new tax law.
If your 2017 state tax return, which you file in 2018, shows a refund, and you apply that refund to your 2018 state income tax, that is considered paid in 2018. It would be included in your itemized deduction, if any, for state income tax on your 2018 federal tax return. That deduction on your 2018 federal tax return is limited by the cap in the new tax law.
