Why was my federal tax owed increased by the amount of my state tax refund?

[ccollins0325]

I did not deducted state income taxes in 2024.

[xmasbaby0]

IS MY 2024 STATE OR LOCAL REFUND TAXABLE?

If you used standard deduction for your 2024 tax return, you do not have to enter a state or local tax refund you received in 2025.   If you itemized deductions then your state or local refund that you claimed on the 2024 return----and received in 2025---must be entered as taxable income on your 2025 return.  If you  are not sure if you itemized for 2024, look at your 2024 Form 1040 line 12.   Do you see the standard deduction amount or something else?

2024 STANDARD DEDUCTION AMOUNTS

SINGLE $14,600    (65 or older/legally blind + $1950)

MARRIED FILING SEPARATELY            $14,600    (65 or older/legally blind + $1550)

MARRIED FILING JOINTLY $29,200    (65 or older/legally blind + $1550)

HEAD OF HOUSEHOLD $21,900    (65 or older/legally blind + $1950)

If you need to enter the state or local refund — go to

Federal>Wages & Income>1099-Misc and Other Common Income>State and Local Tax Refunds on Form 1099G

[ccollins0325]

On my 2024 return, Line 12 has the standard deduction, $14,600.00.

Unfortunately, the discrepancy was not displayed in the software until the forms had been submitted. This was the first time it showed "Total Tax Owed" as an amount LOWER than what it said I owed when paying.

I really appreciate your assistance!

- C