Special One-Time Tax Refund. How do I include it on my Federal return?

[BTRR]

In May 2022, the State of Georgia paid me a special one-time Georgia tax refund of $500.  Due to the State having a budget surplus, every resident received a refund.  Georgia did not issue a 1099-G for the refund.

The refund is not taxable on my Georgia return.  However, it is taxable on my Federal return.  In TT H&B, on my Federal return, WHERE and HOW do I include the $500 as taxable income?  Please advise.  Many thanks.

[CatinaT1 · Accepted solution]

It depends. Did you itemize your deductions last year or use the standard deduction? You do not need to include the payment if you used the standard deduction. If you itemized your deductions, it might be taxable. See this article to determine if you meet the criteria for it to be taxed: IRS Issues Guidance on the Taxation of State Tax Payments Issued in 2022

If it is taxable, enter this into your federal return as follows:

1. Go to Wages & Income
2. Scroll down to Less Common Income
3. Select Miscellaneous Income, 1099-A, 1099-C from the drop-down
4. Select Other reportable income
5. Any Other Taxable Income? = Yes
6. Description = Georgia Surplus Tax Refund and then record the amount

[BTRR]

Very helpful!  Many thanks!