If you itemized your deductions in the previous year, all or some of your prior year state income tax refund may be considered taxable income on this year's Federal tax return (Schedule 1 (Form 1040), Line 1). If you claimed the standard deduction, the state refund is not taxable.

For information on entering the state tax refund, see our State Tax Refund - Received in Current Year for Last Year's State Return FAQ.

If you had a balance due with your 2023 state income tax return (paid in 2024) or made a 2023 state or local estimated tax payment after December 31, 2023, this may be deductible on Schedule A (Form 1040) Itemized Deductions, Line 5.

For information on entering state or local taxes paid, use our State and Local Taxes - Paid FAQ.

Prior year Federal tax refunds (and payments) are not taxable (or deductible) on the current year's Federal income tax return. Check with your state to determine if this information needs to be reported anywhere on your current year state tax return.

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.