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Now this is typical big govt.

 
Ranch Hand
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People will have to pay taxes on their refund checks. Thats big brother for ya.
 
mister krabs
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Ha-ha... I'm from NY so I get to keep it!
 
Bartender
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I don't live in one of the taxed states... but this just completely doesn't make any sense to me... How are these states justifying this tax? This isn't money you have gained... this is money that was earned and taxed already, and that now the governement is giving back due to a lowering of the tax rate... This is like government taxing welfare income or social security... ( Personally, I don't know that much about tax laws in these circumstances... the government may tax these things already... ) Don't most states compute state tax based on the federal tax you pay? So, if anything, the state owes you money for the amount of state tax they overcharged you on...


-Nate
 
Thomas Paul
mister krabs
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Originally posted by Nathan Pruett:
I don't live in one of the taxed states... but this just completely doesn't make any sense to me... How are these states justifying this tax? This isn't money you have gained... this is money that was earned and taxed already, and that now the governement is giving back due to a lowering of the tax rate... This is like government taxing welfare income or social security... ( Personally, I don't know that much about tax laws in these circumstances... the government may tax these things already... ) Don't most states compute state tax based on the federal tax you pay? So, if anything, the state owes you money for the amount of state tax they overcharged you on...


-Nate



The only way this would make sense if these states allow you to deduct your federal taxes paid from your income for state tax purposes. Perhaps someone from one of the states involved can clarify.
And no, most states do not use federal tax to calculate your state tax.
 
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