TaxAct does not calculate this allocation for state taxes. If the amounts for Prior Year State Income Tax Refund (to be included in taxable income on the current year's return) and the deduction for Prior Year State and Local Estimates Paid After 12/31/20YY need to be adjusted, the taxpayer would need to manually perform this allocation. See IRS Publication 525 for details.

To enter the recovery into the TaxAct program, go to our Form 1099-G - Entering State Income Tax Refund in Program FAQ.

To enter the adjusted state and local income tax deduction on Schedule A (Form 1040) into the TaxAct program:

1. From within your TaxAct return, click Federal (on smaller devices, click in the top left corner of your screen, then click Federal).
2. Click the Itemized or Standard Deductions dropdown, then click Taxes paid.
3. Continue with the interview process until you reach the screen titled Enter state and local income taxes you paid during 2024, then click the data entry field below Prior year state and local estimates paid after 12/31/2023, and type the amount.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the webpage or document at the time it is accessed.