TimC Posted January 27, 2011 Share Posted January 27, 2011 I have to report my Virginia State Tax refund from last year as income on this year's Federal Tax refund...and pay tax on it and the state form uses the Federal income line to tax me again on their refund again from last year. Shouldn't this be like a circular reference on an Excel spreadsheet or am I missing something? Quote Link to comment Share on other sites More sharing options...
SEC=UGA Posted January 27, 2011 Share Posted January 27, 2011 I have to report my Virginia State Tax refund from last year as income on this year's Federal Tax refund...and pay tax on it and the state form uses the Federal income line to tax me again on their refund again from last year. Shouldn't this be like a circular reference on an Excel spreadsheet or am I missing something? You best pay your taxes son, they'll come and get you in the middle of the night if you don't. Quote Link to comment Share on other sites More sharing options...
Caveman_Nick Posted January 27, 2011 Share Posted January 27, 2011 I have to report my Virginia State Tax refund from last year as income on this year's Federal Tax refund...and pay tax on it and the state form uses the Federal income line to tax me again on their refund again from last year. Shouldn't this be like a circular reference on an Excel spreadsheet or am I missing something? You claim your state income taxes as a deduction from your income that's subject to federal taxes, so if you got some back you had more taxable income. Quote Link to comment Share on other sites More sharing options...
yo mama Posted January 27, 2011 Share Posted January 27, 2011 (edited) You claim your state income taxes as a deduction from your income that's subject to federal taxes, so if you got some back you had more taxable income. Exactly. It's kind of like reversing the deduction you got for paying those taxes. However, you are free to let them keep your refund check if you'd prefer to keep the income tax deduction instead. Edited January 27, 2011 by yo mama Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.