Author Topic: state rebate checks  (Read 861 times)

Beach_Bound

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state rebate checks
« on: February 05, 2023, 12:16:21 PM »
Quick version: is my state “relief rebate” check considered federally taxable income?

I received a check from the state of Delaware in 2022 for $300. The letter accompanying the check called it a “relief rebate program.” The state government website says the money is not taxable by the state of Delaware but says nothing about federal tax. Here’s the link to the state website
https://finance.delaware.gov/2022-delaware-relief-rebate-program/

Other states have mixed answers to whether the rebate money is taxable, and which forms will report it. Most use form 1099-G. Intuit has a summary at this link
https://proconnect.intuit.com/support/en-us/help-article/tax-return/need-enter-state-stimulus-payment/L7hWslhjR_US_en_US

I itemized my federal taxes in 2021 and will do so again in 2022. I received a 1099-G from Delaware because I had a state income tax refund in 2021. The amount on the 1099-G includes only the state income tax refund, not the $300 rebate.

Is there any way to figure this out short of contacting the Delaware Division of Revenue? My experience with them hasn't been great. They wanted some additional documentation before issuing my refund last year, and getting responses was like pulling teeth.

MDM

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Re: state rebate checks
« Reply #1 on: February 06, 2023, 09:16:26 AM »
IRS issues statement about the taxability of state payments might be of interest.  In short, "maybe".

Beach_Bound

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Re: state rebate checks
« Reply #2 on: February 06, 2023, 04:24:33 PM »
IRS issues statement about the taxability of state payments might be of interest.  In short, "maybe".

Thanks! I missed that in my earlier googling. Guess I'll have to be patient.

Beach_Bound

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Re: state rebate checks
« Reply #3 on: February 11, 2023, 06:51:03 AM »
Closing the loop on this - the verdict is not taxable. This applies to 17 of the 21 states that sent checks, including several states that issued forms suggesting the income is taxable.

https://www.irs.gov/newsroom/irs-issues-guidance-on-state-tax-payments-to-help-taxpayers

 

Wow, a phone plan for fifteen bucks!