Why do I need to pay tax on my last years NY State refund? Isn't a refund the extra money NY withheld and hence money that's mine?

[CarolynM]

You pay federal tax on your prior state refund only if you itemized your deductions.

If you itemized, you have already claimed the deduction for state/local tax paid, so this prevents you from receiving double credit.

For more information, follow this link: https://blog.turbotax.intuit.com/tax-tips/is-my-state-tax-refund-taxable-and-why-90/

[racmarti]

Thanks Carolyn - I am actually talking about the NY State Return and not Federal. On the page "New York Income Allocation" in Turbo - do I need to enter my 2017 NY State Refund amount in the NY Source Portion in the row Taxable Refunds of State Income Tax??

[CarolynM]

No