Felix,a single taxpayer,claimed $180 of state tax as an itemized deduction on his 2013 tax return.The total itemized deductions on his tax return were $6,215.In 2014,he received a $25 refund from the state.What is the amount Felix has to report on his 2014 tax return?

Question

Quizplus · Accepted Answer

Since Felix received a refund, he must have overpaid his state taxes in the prior year. Therefore, he must have received a tax benefit from the $180 state tax deduction on his 2013 tax return. As a result, he must report the $25 refund as taxable income on his 2014 tax return. The $180 deduction is not relevant to his 2014 tax return.

Felix,a Single Taxpayer,claimed $180 of State Tax as an Itemized