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Are Stimulus Checks Taxable?

2023 Tax Brackets
On a yearly basis the Internal Revenue Service (IRS) adjusts more than 60 tax provisions for inflation to prevent what is called “bracket creep.” Bracket creep occurs when people are pushed into higher income tax brackets or have reduced value from credits and deductions due to inflation, instead of any increase in real income. (Photo via

Are Stimulus Checks Taxable? The Internal Revenue Service (IRS) released instructions about the federal tax status of special payments made by 21 states in 2022, concluding that many taxpayers in these states won’t be required to record these payments on their 2022 tax returns.

Taxpayers who got stimulus payouts in California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania, and Rhode Island do not have to record these state payments on their 2022 tax return.


Is my state stimulus payment taxable?

Money and budgeting photo illustration by FOX Business. (iStock / iStock)


You can visit the IRS website to view the complete list of relief checks that are exempt.


How About State Taxes That Were Paid?

Regardless of whether they used the standard deduction or itemized deductions, residents of Georgia, Massachusetts, South Carolina, and Virginia who did not get a financial advantage from a state tax refund are not obliged to include the payment in their income.

The Franchise Tax Board suggests consulting your tax advisor or IRS Publication 525, Taxable and Nontaxable Income, before electing to ignore the refund. These sources will provide information on how these payments will be taxed at the federal level.


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There might be more filing difficulties for Californians

Residents of California who received a “Middle Class Tax Refund” of more than $600 already received a 1099-MISC form, so if the state does not correct the error and reissue the forms, there will be a discrepancy that may cause refunds to be delayed or necessitate filers contacting the IRS to resolve the issue.


Middle Class Tax Refund: Eligibility, amount and deadline

The Middle Class Tax Refund will be given to those who are eligible between October 2022 and January 2023. Photo via


Am I Going to Get a Tax Document?

Taxpayers often receive a 1099-G for a state tax refund, according to the IRS.

According to the IRS, whether or not your state income tax refund is taxable on your federal income tax return depends on whether you claimed an itemized deduction for the tax that was later refunded. “Don’t declare any of the refund as income if you didn’t itemize your deductions on your federal tax return for the tax year that produced the refund.”


Financial firms are required to send form 1099 to their customers by February 15.

Financial firms are required to send form 1099 to their customers by February 15. (Photo: Forbes)


17 states, including Colorado, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Maine, Massachusetts, New Jersey, New Mexico, New York, Pennsylvania, South Carolina, and Virginia, promised inflation relief payments in 2022, according to a previous analysis by GOBankingRates. Payments to people ranged from $50 to $1,050 depending on the location and recipient’s income level.


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