Can I deduct on my Federal 2020 taxes $ I paid Ver...
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Can I deduct on my Federal 2020 taxes $ I paid Vermont State taxes on income not reported in 2018?

Unreported income 2018. Tax plus penalty plus interest paid 2020. Can I deduct Fed and State taxes paid on my 2020 taxes.
2 Replies
Level 14

Can I deduct on my Federal 2020 taxes $ I paid Vermont State taxes on income not reported in 2018?

You cannot deduct federal taxes.

You cannot deduct interest or penalties.

But you can deduct state income taxes paid in 2020 for a previous year.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.**

Employee Tax Expert

Can I deduct on my Federal 2020 taxes $ I paid Vermont State taxes on income not reported in 2018?

Federal taxes, penalty and interest are not deductible on your Federal return.

 

State taxes are deductible on your Federal return only if you itemize and choose state income taxes instead of sales taxes. They are not deductible on your state return.

 

Penalty and interest are not deductible.

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