New York State Inflation Reduction check 2025

[Taxi_Nerd]

How do I process (Turbo Tax 1040) the $400 we received from the New York State Inflation Reduction program in the fall of 2025? 

[xmasbaby0]

You do not need to enter that as taxable income into your 2025 return.

[Taxi_Nerd]

Focusing on the 1040. NYS issued a 1099-Q to all recipients. The 1099-Q matters. Where do we go from there? Not sure that it is simply not taxable.  

[PatriciaV]

The conservative treatment would be to include Form 1099-Q on your federal return. If it's not taxable, the IRS may adjust your tax refund accordingly.

Several news outlets reported that the inflation refund check is not considered taxable by New York State, but it is by the federal government. The New York Times article (which requires a subscription to read) is the most notable found by searching the internet. The New York State Department of Taxation FAQ article is silent on the taxation issue, so you may wish to contact them directly.

[shiftyginger14]

I received the credit because I filed a 2023 tax return, but I now live in NJ. I received the check at my NJ address, so they have my info, but I never received 1099-Q. I still work in NY so I'm filing NY taxes. I'm just beyond confused with what to do here.

[AmyC]

Follow these steps:

1. You must get the 1099-G: Go to the NYS Department of Taxation and Finance website and look for the "Get Form 1099-G" link under the Individuals section.
2. Once you have your form, you can enter it and be sure to mark for 2023.
3. As you continue, you will see the question: “Does either apply to your 2023 New York return?” select: NO - the NY inflation refund is not a normal tax refund, and choosing NO forces TurboTax to include it in federal income while subtracting it from New York tax.
4. TurboTax will then ask: “Tell us the taxable amount of your refund” Enter your refund amount.

The income is included on your federal but should not be taxed by either state. 

@shiftyginger14