Stan, a single taxpayer, has $1,700 of state income taxes withheld from his wages in the current year. In the current year, he also received a $320 refund on his prior year state income tax. Stan did not itemize last year but he intends to do so this year. Stan used the sales tax estimate tables and determined his sales tax deduction amount is $1,600. What amount should Stan deduct for state taxes?

Question

Quizplus · Accepted Answer

Stan should deduct the $1,700 of state income taxes withheld from his wages in the current year. He cannot deduct the $320 refund he received on his prior year state income tax. Additionally, since his sales tax deduction is lower than his state income tax deduction, he should use the state income tax deduction instead. Therefore, he should deduct $1,700 for state taxes.

Stan, a Single Taxpayer, Has $1,700 of State Income Taxes