IRS Guidance on State Tax Payments

The IRS has issued guidance (IR-2023-23) on the federal tax treatment of payments made during 2022 by certain states to their residents.

Many states are discussed in the guidance. For New York, the IRS has confirmed that the supplemental child credit and supplemental earned income tax credit issued by New York State in or around October 2022 are not included in a recipient’s federal gross income.

The supplemental child credit and supplemental earned income tax credit are discussed on pages 76 through 77 of the Tax Year 2022 M+O=CPE Individual Tax Year-End Workshop Reference Book.