IRS won’t tax most relief payments made by states last year
Associated PressThe IRS announced Friday that most relief checks issued by states last year aren’t subject to federal taxes, providing 11th hour guidance as tax returns start to pour in. A week after telling payment recipients to delay filing returns, the IRS said it won’t challenge the taxability of payments related to general welfare and disaster, meaning taxpayers who received those checks won’t have to pay federal taxes on those payments. In addition, many taxpayers in Georgia, Massachusetts, South Carolina and Virginia also avoid federal taxes on state payments if they meet certain requirements, the IRS said. Senate President Troy Jackson called the confusion caused by the IRS “harmful and irresponsible.” “Democrats and Republicans worked together to create a program that would comply with federal tax laws and deliver for more than 800,000 Mainers,” the Democrat from Allagash said in a statement Friday.
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