I owe on my Federal and am getting a State refund. The State refund is lower than what I owe. Will my State refund automatically go to cover my Federal, or will I get it?

[ianpjackson]

Curious if the state refund will be sent to me, or if it will be sent directly to the federal govt. The former would be very disappointing.

[tedying]

The two transactions are handled separately.  You will need to pay the amount you owe on Federal Taxes and you will get the full State refund from the state.  The IRS and the state controllers are separate entities and you have individual transactions with each.

[VolvoGirl · Accepted solution]

Federal and state are completely separate.  They don't keep one to pay the other.  At the end Turbo Tax just shows you the net federal and state combined. But that is only for your info. You will still get the full refund and need to pay a tax due.