The Internal Revenue Service has advised millions of taxpayers who have benefited from state rebate and refund payment programs to currently hold off from filing their income tax return while the agency decides on how to treat such receipts.
“There are a variety of state programs that distributed these payments in 2022 and the rules surrounding them are complex. We expect to provide additional clarity for as many states and taxpayers as possible next week. For taxpayers uncertain about the taxability of their state payments, the IRS recommends they wait until additional guidance is available or consult with a reputable tax professional,” the agency said in a statement on Feb. 3….