{"id":2017139,"date":"2023-08-30T17:28:02","date_gmt":"2023-08-30T21:28:02","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/irs-issues-new-guidance-on-taxing-stimulus-checks-expanding-tax-free-status\/"},"modified":"2023-08-30T17:29:28","modified_gmt":"2023-08-30T21:29:28","slug":"irs-issues-new-guidance-on-taxing-stimulus-checks-expanding-tax-free-status","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/irs-issues-new-guidance-on-taxing-stimulus-checks-expanding-tax-free-status\/","title":{"rendered":"IRS updates rules on taxing stimulus checks, broadens tax-exempt status."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Firs-issues-new-guidance-on-taxing-stimulus-checks-expanding-tax-free-status%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2017139&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div data-post-content=\"true\" class=\"post_content\" id=\"post_content\">\n<p>The Internal Revenue Service (IRS) has issued new guidance regarding the federal tax treatment \u200dof various state payments and \u200drefunds, expanding the tax-free treatment of stimulus check payments to those received in 2023.<\/p>\n<p>The new guidelines,\u200b issued on Aug. 30, build on and clarify previous\u2063 guidance issued on Feb. 10,\u200c which said that most relief checks issued by states in 2022 didn&#8217;t need to be reported \u200don 2022 tax returns.<\/p>\n<p>While the previous guidance only described\u200c the taxability of pandemic relief payments,\u2062 and certain other types\u2063 of made in 2022, the Aug. 30 guidelines address their taxability in 2023\u2062 and apply \u200ca similar tax-free status to payments received this year.<\/p>\n<div class=\"shortcode\">\n<div class=\"border-comp-divider mb-4 mr-4 w-full max-w-[500px] border px-5 py-4 text-[16px] leading-[20px] text-[#262626] md:float-left\">\n<div class=\"mb-3 font-sans text-[16px] font-semibold uppercase leading-[19px] text-[#2F2F2F]\">Related Stories<\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\">\n            <a href=\"http:\/\/www.theepochtimes.com\/us\/irs-issues-long-awaited-clarification-on-taxing-stimulus-checks-after-urging-americans-to-delay-filing-5050969\">IRS Issues Long-Awaited Clarification on Taxing Stimulus Checks After Urging Americans to Delay Filing<\/a>\n          <\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">2\/11\/2023<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\">\n          <a href=\"http:\/\/www.theepochtimes.com\/us\/irs-issues-long-awaited-clarification-on-taxing-stimulus-checks-after-urging-americans-to-delay-filing-5050969\"><\/a>\n        <\/div>\n<\/p><\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\">\n            <a href=\"http:\/\/www.theepochtimes.com\/us\/irs-refused-to-pay-stimulus-checks-wrongly-claiming-some-taxpayers-were-dead-report-5462188\">IRS\u200c Refused to Pay Stimulus Checks, Wrongly Claiming Some Taxpayers Were Dead: Report<\/a>\n          <\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">8\/13\/2023<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\">\n          <a href=\"http:\/\/www.theepochtimes.com\/us\/irs-refused-to-pay-stimulus-checks-wrongly-claiming-some-taxpayers-were-dead-report-5462188\"><\/a>\n        <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>&#8220;This means taxpayers who did not get a payment under the program during 2022 may exclude from federal income\u2063 a state \u200bpayment provided under the 2022 program but actually received in 2023,&#8221; the IRS said in a statement.<\/p>\n<p>Besides allowing stimulus check payments to be \u200btax-free in 2023, the IRS has also provided \u200da detailed description of the rules it \u200cuses to determine the federal tax consequences of stimulus checks\u200b and other payments or refunds.<\/p>\n<p>In general, the IRS said that determinations that\u200c state payments qualify for exclusion from federal gross income, and therefore from federal income taxes, fall under the general welfare doctrine or because they were disaster relief payments.<\/p>\n<div class=\"shortcode\">\n<div class=\"lazyload-wrapper\">\n<div class=\"lazyload-placeholder\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>The latest IRS notice also asks for public comment regarding the application of the rules described\u200d in the notice, and on specific aspects of \u2062state \u200dpayment programs or other situations where federal income tax guidance\u200c would be helpful.<\/p>\n<h2>Stimulus Check Tax Exemption Details<\/h2>\n<p>In 2022, a number of states implemented\u200c programs to provide payments to residents, with many of these\u200b programs related to\u2062 the COVID-19 pandemic and its \u2063impacts.<\/p>\n<p>In a statement issued on Feb. 10, the IRS said \u2062that most relief checks issued by states in 2022 aren&#8217;t subject to federal taxes.<\/p>\n<p>&#8220;The IRS\u2063 has determined\u200b that in the interest of sound tax administration and other factors, taxpayers \u200din many states will \u2064not need to report these payments on their 2022 tax returns,&#8221; the agency said\u200d in the statement.<\/p>\n<p>All told, \u200dtaxpayers in \u206217 states don&#8217;t have to report last year&#8217;s stimulus checks, while in another four states, many \u200bpeople will be able \u2064to <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/elizabeth-warren-argues-for-new-corporate-tax-to-fund-bidens-build-back-better-agenda\/\" title=\"Elizabeth Warren Argues For New Corporate Tax To Fund Biden\u2019s \u2018Build Back Better Agenda\u2019\">avoid paying federal taxes<\/a> on their relief payments if they meet\u2064 certain \u200drequirements.<\/p>\n<p>Specifically, various forms of general welfare and disaster relief payments don&#8217;t have to be reported by taxpayers in 17 states: Alaska, \u2063California, Colorado, Connecticut, Delaware, Florida,\u200d Hawaii, Idaho, Illinois, Indiana, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania, and Rhode Island.<\/p>\n<p>In addition, four states were deemed special cases in terms of stimulus check\u200d taxability because they issued relief payments in the form of refunds of state taxes paid: Georgia, Massachusetts, South Carolina, and Virginia.<\/p>\n<p>Relief payments from\u2064 these four states\u2014which came in the form of tax refunds\u2014can be excluded from\u200d income for federal tax purposes, per the IRS guidelines. However, that&#8217;s only if the recipient either claimed \u2062the standard deduction or itemized their deductions, yet didn&#8217;t receive a tax benefit. That would be \u200dthe case if the $10,<a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/irs-issues-new-guidance-on-taxing-stimulus-checks-expanding-tax-free-status\/\" title=\"IRS updates rules on taxing stimulus checks, broadens tax-exempt status.\">000 tax deduction limit applied<\/a>, for example.<\/p>\n<p>After the IRS issued the February guidance on the tax treatment of stimulus checks and other state payments, it\u2062 received requests to provide guidelines \u200con \u200d2023 and future payments, clarifying that the tax-free status of stimulus checks applies to those received \u2064this year.<\/p>\n<h2>State \u200bTax Refunds and Other Payments<\/h2>\n<p>The latest IRS notice outlines the various types of state \u2064payments to individuals \u2062and\u200b delineates the corresponding\u2062 federal tax treatment for each category.<\/p>\n<p>For the majority of\u200b taxpayers who receive state tax refunds, the \u2062refund amount does not need \u2064to be reported as income for federal tax purposes. This holds true especially for taxpayers who opt for the standard deduction on their <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/irs-requirement-to-report-stolen-property-as-income-goes-viral\/\" title=\"IRS Requirement to Report Stolen Property as Income Goes Viral\">federal income tax returns<\/a>.<\/p>\n<p>The IRS said<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>in 2020 and 2021 were not taxable. The IRS now confirms that stimulus checks received in 2023 will also be tax-free. This updated guidance aims to provide clarity on the federal tax treatment of state payments and refunds, ensuring taxpayers understand their obligations and benefits accurately.<\/p>\n","protected":false},"author":118,"featured_media":2017140,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-2017139","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2017139","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/118"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2017139"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2017139\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2017140"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2017139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2017139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2017139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}