topic Re: why is my state refund not taxable? in Get your taxes done using TurboTax

Tax Year Prior to 2020: why is my state refund not taxable?

wei0313 — Mon, 22 May 2023 21:41:38 GMT

I didn't receive my 1099-G. I just follow the turbo tax steps, and it populated my 2018 CA state refund automatically. I went through the steps, but turbotax is telling me that my state refund is not taxable. I don't quite understand why this happens because I had itemized deduction in my 2018 filing. In my previous years' filings, all my state refund were taxable. I am quite puzzled, and I can't find any relevant google search research to explain the behavior. Could anyone help explain on the behavior?

Thanks

Re: why is my state refund not taxable?

rjs — Mon, 24 Feb 2020 02:22:55 GMT

It's hard to say without being able to see your 2018 federal tax return. My guess for the most likely reason would be that your 2018 total state and local taxes exceeded the $10,000 (or $5,000) cap by more than the amount of your state refund. Therefore you did not get any tax benefit from the refunded part of your state tax.

If you are using the CD/Download TurboTax software for 2019, you can look at the State and Local Income Tax Refund Worksheet to see how the taxable amount of your refund was calculated. Or look at your 2018 Schedule A. If line 5d is more than line 5e, and line 5d minus line 5e is more than your state refund, the refund is not taxable.

Re: why is my state refund not taxable?

wei0313 — Mon, 24 Feb 2020 02:58:20 GMT

Thanks rjs. That answers my question!!

Re: why is my state refund not taxable?

Tag104 — Mon, 16 Mar 2020 01:33:00 GMT

Thank you!

Re: why is my state refund not taxable?

VictorW9 — Mon, 16 Mar 2020 01:57:56 GMT

You had the option to choose to deduct either state and local income taxes or general sales taxes. if you choose general sales taxes, none of your refund is taxable.