This is a situation where calendar years and tax years cross.
Yes, you will claim State Tax Paid (in 2021) on your Tax Year 2021 Federal return.
If you get a State Refund for tax Year 2021, that will be received in 2022, so it might be taxable income next year on your 2022 Federal Return.
If you select to use State Sales Tax in place of State Income Tax, the refund you get in 2022 will not be taxable.
If you select to use State Income Tax rather than Sales Tax, the refund you get in 2022 MAY BE taxable.
When you use the State Income Tax on Schedule A, and get a refund, the refund amount attributable to the state income tax is taxable income. (it is a bit complicated which is why TurboTax asks if you received a State refund, and if yes, it asks what you claimed on the previous year's Schedule A for Sale's tax OR Income tax.)
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