The IRS says it’s confirming whether state-issued relief checks should be taxed federally.
related to either tax surpluses or inflation in 2022, you might want to hold off on filing your tax return, the Internal Revenue Service says.
The agency is clarifying whether these special state tax rebates should be taxed federally, an IRS spokesperson tells CNBC Make It. The"rules surrounding them are complex" and will require more time to determine the tax implications,"We expect to provide additional clarity for as many states and taxpayers as possible next week."
The IRS recommends that tax filers who qualified for relief checks wait until"additional guidance is available or consult with a reputable tax professional."It's not yet clear which specific states require more guidance, but at least 18 enacted one-time refunds in 2022, : Arkansas, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Maine, Massachusetts, New Mexico, New York, Oregon, Rhode Island, South Carolina and Virginia.Most of those 18 states are still waiting to confirm whether the rebates will incur federal taxes, says Richard Auxier, a Tax Policy Center senior policy associate.
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