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

Alerts and notices

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)