How do I calculate my refunds received for state/local tax returns?

In some cases, state tax refunds received in Year 1 may be taxable income on your Federal tax return in Year 2.  Follow these steps in TurboTax Online.

• Down the left side of the screen, click on Federal.
• Across the top of the screen, click on Wages & Income.
• Under Your income, scroll down to Other Common Income and click Start to the right of Refunds received for state/local tax returns.
• Follow the interview questions. 

TurboTax will determine how much (if any) of the refund amount is taxable income on the current year's tax return.  It will be necessary to access previous years' tax return information if TurboTax did not prepare those tax returns.

​​​​​​​