How to properly enter last year's state refund if filing jointly for the first time

[tan_zhif]

Me and my spouse are filing jointly for the first time this year. We filed separately last year because we have not been married last year. Now in turbotax under Wages & Income -> Other Common Income -> Refunds Received for State/Local Tax Returns it is asking for state tax refund received last year, and it does not seem to have separate entries for me and my spouse. How do I enter this information correctly? Do I simply just add them up?(I paid state tax and my spouse got a refund last year). Thank you.

[HelenC12]

You would enter the amount of the refund your husband received. Do not deduct the amount you paid.

When you report last year’s state or local tax refund, TurboTax will figure out if it’s taxable or not.

If all three of the following are true, your refund counts as taxable income:

• You itemized deductions last year, instead of taking the standard deduction
• You claimed state and local income taxes (not general sales taxes)
• Claiming the deduction helped you increase your federal refund or lower your tax bill

Even when your refund is taxable, it may not be the entire amount. It depends on how much the deduction affected your refund or tax bill. Just answer a few simple questions about last year’s refund, and we’ll calculate the taxable amount for you.

[tan_zhif]

Hello, thank you for your quick response. One more question, turbotax also asks for total amount of withholding. How should I enter this field? Should I sum up both of our withholding for 2021? Thanks

[HelenC12]

Yes, add up any payments you made to your state or locality, along with any state or locality withholdings from the previous tax year, including:
 - Amounts withheld on your W-2, W-2G, and 1099
 - Estimated tax payments for 2021 (including any paid in 2022 for 2021 - it's common for the fourth quarterly payment to be made in January)
 - Overpayment from 2020 applied toward your 2021 return
 - Payments made with an extension of time to file
 - Refundable credits

You can find most of this info on your 2021 state tax return. Do not include balance due payments made with (or after) filing a return. 

• You'll have a chance to enter the balance paid in a subsequent screen. 
• Enter the total amount of all of these combined here.

Note: If you and your spouse claimed the standard deduction, generally, your state income tax refund will not be taxable.

[katermartinez]

Once I've entered the joint refund and withholding information for myself and my spouse, the next step asks me to confirm that my prior year tax information is correct, and it only pulls in the information for myself, not the joint info for my spouse and me. Should I indicate that the prior year information is not accurate and update amounts for the totals between both my spouse and myself?

[ErnieS0]

Yes. Indicate that the prior year information is not accurate and update amounts for the totals between both your spouse and yourself.

TurboTax can only update information from your prior year account, Under federal law, it can't access information from any other taxpayer's account.

If you are filing jointly in 2022 but single or separately in 2021,  you'll manually add the other spouse's information to your new joint account.

@katermartinez