Form 1041 reporting state tax paid and state refund received during the same year (after an amended return)

[no-name1]

Using Turbotax Business I filed a trust 1041 for 2020 and paid state and federal taxes due when I filed in 2021.  Later I received an amended K1 and amended the 2020 return whereby NO state or federal taxes were due.  I received the state refund during 2021.  How do I report the taxes paid and refund received.  State taxes as an expense and the refund as Other Income?

I have no received the federal refund due to IRS backlog, so that creates a taxable gap in DNI for the 2021 return.

[RobertB4444]

The state taxes paid are a deduction on the federal return.  If you paid them in 2021 reduce them by the refund.  If you paid them in 2020 then you should have adjusted them when you amended the 2020 return.

[no-name1]

Thank you for your reply.  Yes the state taxes were paid in 2021 and refunded in 2021 so I assume I do not report either in the 2021 return.

But, I don't know how to handle federal taxes.  Those were paid in 2021 but have not received the refund yet. Assuming I receive the refund in 2022, how should that be reflected in the 1041 for the 2022 return?

Thank you.

[RobertB4444]

Federal taxes are never a deduction on a federal return.  Federal refunds are never income on a federal return.  Ignore them both.