Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research may determine where and how companies appear. Learn more about how we make money.

Published: Feb 13, 2023 3 min read
Close-up of a 1040 Individual Income Tax Form
Money; Getty Images

If you received a relief payment or stimulus check from your state last year, good news: You don’t need to report it on your federal tax return. Probably.

After much deliberation, the IRS issued new guidance on Friday clarifying that residents of certain states who received tax rebates in 2022 do not need to report those rebates as income.

Last year, many states distributed these special relief payments to eligible residents to help them cope with rising prices and energy costs as well as expenses related to the pandemic. The IRS had previously advised taxpayers to wait to file their taxes this spring until it determined whether the state payments would be taxed at the federal level.

Ads by Money. We may be compensated if you click this ad.AdAds by Money disclaimer
The right Tax Relief firm makes all the difference, especially if you owe over $10k in taxes.
Get tailored experience that you expect from your tax litigation and tax preparation professionals in your area. Click on your state to get started!
HawaiiAlaskaFloridaSouth CarolinaGeorgiaAlabamaNorth CarolinaTennesseeRIRhode IslandCTConnecticutMAMassachusettsMaineNHNew HampshireVTVermontNew YorkNJNew JerseyDEDelawareMDMarylandWest VirginiaOhioMichiganArizonaNevadaUtahColoradoNew MexicoSouth DakotaIowaIndianaIllinoisMinnesotaWisconsinMissouriLouisianaVirginiaDCWashington DCIdahoCaliforniaNorth DakotaWashingtonOregonMontanaWyomingNebraskaKansasOklahomaPennsylvaniaKentuckyMississippiArkansasTexas
Get Started

The rules

According to the IRS, residents of the following states do not need to report their state relief payments as income. These states categorized their payments as general welfare or disaster relief payments, which — like the 2020 and 2021 federal stimulus checks — are legally not taxable.

  • Alaska
  • California
  • Colorado
  • Connecticut
  • Delaware
  • Florida
  • Hawaii
  • Idaho
  • Illinois
  • Indiana
  • Maine
  • New Jersey
  • New Mexico
  • New York
  • Oregon
  • Pennsylvania
  • Rhode Island

Residents of the following four states do not have to report their state payments, which were technically refunds of state taxes paid, if they claimed the standard deduction or if they itemized their deductions but didn’t receive a tax benefit.

  • Georgia
  • Massachusetts
  • South Carolina
  • Virginia

The IRS added that New York and Illinois issued multiple payments, one of which was also considered a refund of state taxes. Those payments fall under these rules, too. Alaska residents do not need to report supplement energy relief payments, but the annual permanent fund dividend is taxable.

Advice from Money

Tax season has begun, and this new guidance means that taxpayers who were waiting to file can now do so. The official due date is April 18 for most people. If you want to receive your refund quickly, it’s best to file as early as possible, do so electronically and select direct deposit as your delivery method.

Ads by Money. We may be compensated if you click this ad.AdAds by Money disclaimer
If you owe more than $10k in taxes, Tax Relief can allow you to break down your debt into payments.
Anthem Tax Relief provides a full menu of tax relief services to help clients get out from under the yoke of tax debt.
Get Started

More from Money:

IRS Tells Millions of Taxpayers Not to File Their Taxes Yet

Here's When the Tax Filing Season Starts in 2023 (and How to Get Your Refund ASAP)

How to File Taxes for Free in 2023