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Did you receive a state or local refund last year?

Those nice tax refunds you received after filing your state and/or local returns last year might be considered taxable income, which is why you must enter the information as you complete your federal return this year. But don’t panic; state and local tax (SALT) refunds can only be counted as income for taxpayers who itemized deductions on last year’s federal return. If you claimed the standard deduction last year on your federal tax return, any state or local refund you received is not taxable and you don’t have to report it. Why the different treatment? It’s because if you itemized deductions last