Are Illinois Property Tax and Income Tax Rebates Taxable?

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Topic Author
sparky123
Posts: 72
Joined: Mon Nov 20, 2017 8:14 am

Are Illinois Property Tax and Income Tax Rebates Taxable?

Post by sparky123 »

Do I have to claim the Illinois Property Tax Rebate or the Income Tax Rebate that I got last year on my federal return? I don't itemize.
The only info I see is this:
The Illinois individual income tax rebate and property tax rebate are not subject to Illinois income tax. If you itemize deductions for federal income tax purposes, the rebates may have an impact on your 2022 federal income tax. Please contact your tax advisor if you have questions about your tax obligations.
on the Illinois gov website:

https://tax.illinois.gov/programs/rebates.html
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Artful Dodger
Posts: 1995
Joined: Thu Oct 20, 2016 12:56 pm

Re: Are Illinois Property Tax and Income Tax Rebates Taxable?

Post by Artful Dodger »

I was going to say that I don't know why they would be taxable as they are simply a refund of a tax paid which is no longer deductible for federal income tax purposes. But, I'm one of those who takes the standard deduction when filing my federal taxes. I can see if the total for your property, state tax, and mortgage interest, etc. are greater than the standard deduction amount then the rebate should be deducted from that total when filing this year.

I'll be curious to see if the question comes up in my turbo tax this year.
ChicagoBear7
Posts: 170
Joined: Tue Jan 16, 2018 12:12 pm

Re: Are Illinois Property Tax and Income Tax Rebates Taxable?

Post by ChicagoBear7 »

The rebates would be taxable IF YOU ITEMIZED in 2021. The amounts were deemed to be rebates based upon your 2021 tax information, so if you took a federal deduction for real estate and/or income taxes, you would need to add the rebates to your 2022 income. The same thing happens each year for anyone who deducts state income tax for federal taxes and then receives a refund on their state return. The following year you need to add back the previous years' refund -- once again, only if you itemize. If you didn't itemize in 2021 - enjoy your rebate(s)!
Topic Author
sparky123
Posts: 72
Joined: Mon Nov 20, 2017 8:14 am

Re: Are Illinois Property Tax and Income Tax Rebates Taxable?

Post by sparky123 »

Thanks for the fast response!
Topic Author
sparky123
Posts: 72
Joined: Mon Nov 20, 2017 8:14 am

Re: Are Illinois Property Tax and Income Tax Rebates Taxable?

Post by sparky123 »

The IRS has just answered my question. Illinois and 15 other states not taxable. 5 other states get a maybe taxable.

https://www.irs.gov/newsroom/irs-issues ... -taxpayers
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