1040-US: If the general sales tax deduction is taken, the state tax refund will not be taxable on next year's return

Show expandable text

New (tax) year, new help!

Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

Question

Will the state income tax refund be taxable next year if the General Sales Tax Deduction is taken this year?

Answer

If the General Sales Tax Deduction is taken, the state tax refund will not be taxable on next year's return. If income taxes are deducted instead of sales tax, UltraTax CS will calculate a sales tax benefit reduction amount, when applicable.

Related topic: Sales tax FAQs (1040)

Was this article helpful?

Thank you for the feedback!