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If you itemized deductions on your federal return in the 2019 tax year, then a state refund that you received in 2020 may be taxable. You would enter the amount in the State Tax Refund section of TaxAct®. If you did not itemize on your 2019 federal return, then the state refund would not be taxable to you.

To enter the state tax refund:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click State Income Tax Refund in the Federal Quick Q&A Topics menu, then click + Add Form 1099-G State Refund Document to create a new copy of the form and enter the information from your Form 1099-G Certain Government Payments or click Edit to review a form already created.
  3. Continue with the interview process to enter all of the appropriate information.
  4. On the screen titled State or Local Income Tax Refund - Document - Summary, click Continue, then click Total of itemized deductions if you want to determine what portion (if any) of the refund amount(s) entered are taxable on your return.
  5. The program will proceed through the applicable screens for you to enter or review the information from your prior year federal return to determine the taxable amount (if any) of your state income tax refund.
  6. The screen titled State or Local Income Tax Refund - Taxable Refund will indicate the taxable portion (if any) of your prior year state income tax refund based on the entries on the previous screens. Click Continue to finish.

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


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