The MCTR is not taxable on the CA tax return, but no guidance has been provided by the IRS as to whether or not it is taxable on the federal tax return.
There will be a question asking if the payment is for the California Middle Class Tax Refund. Make sure to Select “Yes” to automatically exclude this amount from federal income. Therefore, TurboTax software is not treating this payment as taxable income.
Once we get more guidance from the IRS, we will notify you of the changes and how to handle them.
