Originally Posted by BBQ-Nut
So, I'm starting to use Taxcaster for a first cut estimate at our 2014 taxes - and had a question.
When you get to the section for "Other Tax Payments" there is a box for:
* Other State Payments.
The help box says that you can use this for:
"Also tax payments you made in that same year, when you filed the previous year's state tax return"
I don't have our 2013 return in front of me, so is this amount for what our State taxes were in 2013? We got a tiny bit back based on our withholdings and deductions, so would the amount for Taxcaster be zero or what the State tax total was before tax withholdings and deductions?
Sorry for the stupid question.
If you are simulating your 2014 federal return, you would be entering any state income tax payments you made in 2014 via estimated taxes
(but not withholding which is entered separately as I just discovered).
If , for example, you made an state est. tax payment in Jan. 2014 for your 2013 state tax return, that would count for a deduction on your 2014 federal.
However if you made that same payment in Dec 2013, that would count for your 2013 federal(not 2014). Also if you owed state tax for 2013 and paid it in April 2014, that would also be a 2014 federal deduction.
State refunds are counted on the income side (if at all) and don't affect the deduction.
Another trap to avoid: click on the ? by dividends and it tells you that your entry there assumes qualified dividends and that non-qualified dividends are entered elsewhere.