Norma who is single and uses the cash method of accounting, lives in a state that imposes an income tax. in april 2019, she files her state income tax return for 2018 and pays an additional $1,000 in state income taxes. during 2019, her withholdings for state income tax purposes amount to $7,400, and she pays estimated state income tax of $700. in april 2020, she files her state income tax return for 2019, claiming a refund of $1,800. norma receives the refund in august 2020. norma has no other state or local tax expenses.
a. assuming that norma itemized deductions in 2019, how much may she claim as a deduction for state income taxes on her federal return for calendar year 2019 (filed april 2020)
b. assuming that norma itemized deductions in 2018 (which totaled $20,000), how will the refund of $1,800 that she received in 2019 be treated for federal income tax purposes?
norma will include $ as income in 2019.
c. assume that norma itemized deductions in 2018 (which totaled $20,000) and that she elects to have the $1,800 refund applied toward her 2019 state income tax liability. how will the $1,800 be treated for federal income tax purposes?
norma will include $ income in 2019.
d. assuming that norma did not itemize deductions in 2018, how will the refund of $1,800 received in 2019 be treated for federal income tax purposes?
norma will include $ as income in 2019.