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From: wjm@whuxj.UUCP (MITCHELL)
Newsgroups: net.taxes
Subject: Re: No Double Taxation (again)
Message-ID: <172@whuxj.UUCP>
Date: Thu, 29-Mar-84 10:58:32 EST
Article-I.D.: whuxj.172
Posted: Thu Mar 29 10:58:32 1984
Date-Received: Fri, 30-Mar-84 02:22:13 EST
Organization: Bell Labs, Whippany, N.J.
Lines: 9

As I've said before, there is NO double taxation when you have to report
State income tax refunds as income in the following year.  The reason you
have to report them is that in the previous year you DEDUCTED the entire
amount you paid the State folk (including the refund) from your income and
therefore did NOT pay tax on it.  In effect, you've deferred paying taxes
on the refund for one year.
Bill Mitchell
Bell Communications Research, Inc.
Whippany, NJ (whuxj!wjm)