You'll need to sign in or create an account to connect with an expert.
Since you received the money in 2018, you deal with it on your 2018 return, you don't adjust the 2017 return.
It is taxable in 2018 if you got a tax benefit in 2017. This may require analysis. For example, if you claimed the standard deduction in 2017, then you got no tax benefit from the interest you paid, and the rebate is not taxable now. Suppose you itemized your deductions and had $25,000 of deductions including the interest and the rebate was $100. You would have deducted $24,900, so the entire amount is taxable.
But suppose your total deductions including interest were $12,900, and the rebate was $300. Because the standard deduction in 2017 was $12,700, you only got a $200 tax benefit from the interest, so only $200 is taxable even though the rebate was more.
After determining the taxable amount of the rebate, enter it on your 2018 return under "other uncommon income", look for "taxable recovery" or "reimbursement of a previous deduction."
Still have questions?
Questions are answered within a few hours on average.
Post a Question*Must create login to post
Ask questions and learn more about your taxes and finances.
joseflandau
Level 2
samsona38
New Member
oftamimi
New Member
MartyDC
Level 3
Fou65000
Level 3