im trying to do my taxes myself, wondering if the refund we got last Jan. counts as income for last year
2007-01-04 06:49:54 · 16 answers · asked by Kristine R 4 in Business & Finance ➔ Taxes ➔ United States
No it is not "income" and not included on your return this year.
Last year, you had money withheld from your pay by your employer that was to be an estimate of how much tax you owed on income earned that year. You had too much withheld and the IRS refunded you the overpayment. You've already been taxed on your previous year's earnings.
2007-01-04 07:12:16 · answer #1 · answered by bnkr27 2 · 0⤊ 0⤋
No federal refund can ever be counted as income.
State refunds can be income but only under certain circumstances. If you itemize deductions and you claim state taxes as a deductible expense, a refund of some of those expenses should be added back into income the following year.
2007-01-04 06:59:41 · answer #2 · answered by Anonymous · 0⤊ 0⤋
It is not deducted from this years refund. The amount you received last year is used to determine if you received all you were eligible for last year. There are cases where taxpayers did not receive it all due to too much income, too little tax liability, or they have an additional child on the 2008 tax return. If asked in a tax program enter the exact amount you received so the program can figure if you received all you were eligible for. The IRS will back this up with their own records. Laura H – H&R Block – Senior Tax Advisor 5 **This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.
2016-03-29 07:42:18 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Federal - No. State - I guess it really depends on your state. I am a CPA in Texas, a state with no income tax, and I honestly doubt the accuracy of some of the answers above. For instance, I don't see how New York could claim that their refunding you money because you owe less tax than what was withheld constitutes income.
While I agree with Joseph above, if you find out later your number was wrong on last year's federal return, conceptually, if you do your federal and state returns together, it seems you could "true it up" while preparing both and avoid the issue he describes.
2007-01-04 06:59:45 · answer #4 · answered by lmnop 6 · 0⤊ 0⤋
In NY State, your State refund counts as income if you itemized on your Tax Return.
Federal refund, no.
2007-01-04 06:51:16 · answer #5 · answered by kja63 7 · 0⤊ 0⤋
A federal refund does not count as income.
State and local refunds do count as income if you itemized the previous year and deducted them.
2007-01-04 16:01:20 · answer #6 · answered by Judy 7 · 0⤊ 0⤋
If you deducted state taxes paid on your federal return and you get a state tax refund, then that counts as income for your federal return. Otherwise, no.
2007-01-05 07:31:32 · answer #7 · answered by growing inside 5 · 0⤊ 0⤋
Federal refunds, no. State tax refunds, yes.....but only if you had itemized and taken a deduction for those state taxes against your federal taxable income.
2007-01-04 07:09:34 · answer #8 · answered by jseah114 6 · 0⤊ 0⤋
no a tax refund doesnt count as income
2007-01-04 06:51:22 · answer #9 · answered by Anonymous · 0⤊ 1⤋
The Federal refund is not taxable. Your state refund is taxable on Federal if you itemized deductions and were not in the AMT for that year.
2007-01-04 06:54:43 · answer #10 · answered by spicertax 5 · 1⤊ 0⤋