State refund due to amended return

I am filing an amended 2006 state return that will result in an additional refund that I should receive in 2009. I itemized on my federal return in

2006 so I would have had to declare the state refund on my 2007 federal return. I did not itemize in 2008. Usually I would not have to declare a state tax refund for tax year 2008 on my 2009 return since I did not itemize for tax year 2008. Will I have to declare the 2006 state refund on my 2009 federal taxes?

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Reply to
fpetran
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Yes, to the extent that amount of state income tax provided you with a tax benefit for tax year 2006.

And if your state is generous enough to pay interest on that refund, that is federal taxable interest income.

Reply to
Arthur Kamlet

Interest on a state tax refund is also taxable by the state (for states that tax interest).

Reply to
D. Stussy

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