State Income Tax Refund 1099G - Taxable Income

The IRS does not let you separate your state refund based on how you would have filed if you did not get married. The IRS states, most taxpayers are Cash Basis Taxpayers. Please see the IRS information about Tax Years.

• A cash basis taxpayer is a taxpayer who reports income and deductions in the year that they are actually paid or received, based on their filing status as of 12/31.

In your example, you state you used "single" to compare whether the state refunds were taxable or not. You can't use "single" since you're filing status is not single as of 12/31/2022. 

• To accurately compare, you would use the "Married Filing Separately (MFS)" filing status, to see the tax impact of your state refunds. 

Generally, filing jointly (one tax return instead of two) will give you a bigger refund or less taxes due versus Married Filing Separately. 

If you have the CD/Download version of TurboTax, click here to enter What-If Worksheet.

If you're using TurboTax Online, you can compare your estimated taxes for filing jointly vs. separately with TaxCaster or create two new accounts, enter your respective information to see the impact of filing MFS.

When you file separately, your tax rate is higher and you won't be able to claim:

• Education benefits
• Earned Income Credit (EIC)
• Child and Dependent Care Credit (usually)
• Adoption Credit (usually)
• The standard deduction if your spouse is claiming itemized deductions
• The full benefit for itemized deductions, the Child Tax Credit, and capital losses (you'll get only half compared to married filing jointly).