You can deduct payments made in 2016 for state income taxes owed in a prior tax year on a federal tax return. You cannot deduct any penalties or interest paid or payments made in prior tax years.
- Click on Federal Taxes (Personal using Home and Business)
- Click on Deductions and Credits
- Click on I'll choose what I work on (if shown)
- Scroll down to Estimates and Other Taxes Paid
- On Other Income Taxes, click on the start or update button
Scroll down to Other Income Taxes Paid in 2016. Select the type of taxes paid