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I found out this tax credit expired. 2024 was the last year. There was legislation put forward to extend it, but it was not passed. Talked to a state rep about it. They basically said the because of the deficit, the state can't afford fully refundable credits like this one so they let them expire. You can chatgpt it and it will give you a pretty thorough and correct explanation, at least it did for me.

The homestead credit reduces your tax liability but is not refundable. You may be seeing a refund because you had $750 withheld in taxes through the year which is refunded to you when there is no tax liability. You can verify your tax liability and your taxes paid in.

Thanks!  It's Iowa, not Virginia.  But since it makes sense for other states (I saw a thread about Colorado too) I'm not going to worry about it.  I know there is no tax implication, it appears to be pulling from a specific line of the Federal form, but doesn't match.  I would just prefer not to have to deal with the hassle of the IRS, so wanted to make sure it wouldn't be a flag.  I appreciate your response!

Federal and state refunds come from completely separate entities,  There is no rule as to which one will come first or how much time there will be between their arrivals.  Some states process returns quickly and some are very slow.   STATE RETURN Make sure your state return was accepted:  https://turbotax.intuit.com/tax-tools/efile-status-lookup/   To track your state refund:       ttps://ttlc.intuit.com/turbotax-support/en-us/help-article/tax-refund/track-state-refund/L3jgO8PGs_US_en_US?uid=lt447ebr https://ttlc.intuit.com/turbotax-support/en-us/help-article/state-taxes/contact-state-department-revenue/L9qVToi02_US_en_US?uid=m6e06um0