TTT
Level 2
‎03-02-2022 04:43 PM

My client uses Standard Deduction for the current tax year-2021,

but he used Itemized deduction last year-2020.

 

Do I have to report his State Refund he received during the tax year-2021 on schedule 1: Taxable Refund?

0 Cheers
jeffmcpa2010
Level 11
‎03-02-2022 04:45 PM

Yes -  because he deducted those taxes on the 2020 return. 

so now the refund is income.

Jim-from-Ohio
Level 11
Level 11
‎03-02-2022 05:33 PM

actually the answer is maybe.. some of it may be taxable.. all of it may be.. or none of it.. there is a state and local tax refund worksheet in the program.  if you did their 2020 return it should mostly populate for you.  I am finding many of these refunds are not taxable in 2021 as there was no tax benefit on the 2020 return due to the SALT limitation. 

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