Problem $10-30($LO$.4)$

Nichole, who is single and uses the cash method of accounting, lives in a state that imposes an income tax. In April $2023,$ she files her state income tax return for $2022$ and pays an additional $$1,000$ in state income taxes. During $2023,$ her withholdings for state income tax purposes amount to $$7,400,$ and she pays estimated state income tax of $$700.$ In April $2024,$ she files her state income tax return for $2023,$ claiming a refund of $$1,800.$ Nichole receives the refund in August $2024.$ Nichole has no other state or local tax expenses.

If an amount is zero, enter $"0".$

a$.$ Assuming that Nichole itemized deductions in $2023,$ how much may she claim as a deduction for state income taxes on her Federal return for calendar year $2023($filed April $2024)?$

Feedback

Check My Work

The state and local income taxes imposed upon an individual are deductible only as itemized deductions. Cash basis taxpayers deduct stat income taxes in the year paid regardless of the year to which the payment relates. The tax benefit rule applies to state income tax refund: