What does this tax question mean regarding refund of state/local taxes?

Crystal Sunshine: What does this tax question mean regarding refund of state/local taxes?
“Did you receive a refund of state and/or local income taxes during 2009 from your 2008 tax return or a prior year tax return?” In 2008 we got a refund because we overpaid from what they took out of our paychecks. Does this mean I enter how much the refund was? Or is this talking about some other kind of refund?
I use the standard deduction and the money where the refund comes from was withheld from my paycheck.

Answers and Views:

Answer by Diane A
yes, you enter your refund. You did not pay taxes on your refund, so now you do.

Answer by card-ron
You’ve got it right: you enter the amount of your state and/or local income tax refund you received in 2009.

If, on your 2008 tax return, you itemized deductions and claimed a deduction for state and local income taxes, for 2009 you will have to pay federal tax on the amount refunded to you. If you did not itemize deductions or did not claim a deduction for state and local income taxes, you will not be taxed on your refund.

Answer by peacefuldisaster
Tax refunds from state and local governments are treated as income by the IRS and must be reported on your federal tax return.

Answer by becky
If you itemized on your 2008 federal tax return (rather than taking the standard deduction), then your 2008 state refund could be partially taxable on your 2009 federal tax return. It depends on what you itemized and where the state refund came from originally. (Like from paycheck withholdings versus from various deductions.) If you used the standard deduction, then your state refund is not taxable, and you’re off the hook.

Answer by tro
if you got a state refund the previous year and you itemized, this would be income to you for the current year
if you didn’t itemize forget the whole thing

Answer by Tyler W
Yes, you enter the ammount refunded to you iby the state in 2009 because you overpaid in 2008.