{"id":863,"date":"2016-03-31T13:53:12","date_gmt":"2016-03-31T17:53:12","guid":{"rendered":"http:\/\/www.etax.com\/blog\/?p=863"},"modified":"2016-03-24T13:54:09","modified_gmt":"2016-03-24T17:54:09","slug":"federal-income-tax-deduction-state-taxes","status":"publish","type":"post","link":"https:\/\/www.etax.com\/blog\/2016\/03\/31\/federal-income-tax-deduction-state-taxes\/","title":{"rendered":"Federal Income Tax Deduction: State Taxes"},"content":{"rendered":"<p>You are allowed to deduct state taxes on your Federal income tax return. Additionally, many states allow you to deduct any taxes you paid to other states. So it only seems logical that you should be able to deduct Federal income tax when filing your state return. However, only six of the 41 states with income taxes allow <a href=\"https:\/\/www.etax.com\/blog\/2026\/02\/19\/new-auto-loan-interest-deduction-how-to-save-up-to-10000-on-your-taxes-2025-2028\/\">deduction<\/a> of Federal taxes on state returns.<\/p>\n<p><strong>Alabama: <\/strong>you can deduct the total amount of your Federal tax liability after you subtracted the amount of Federal tax credits you claimed.<\/p>\n<p><strong>Iowa:<\/strong> you can deduct any Federal taxes that you paid in cash throughout the year. That means Federal taxes that were withheld from your salary, as well as estimated payments made each quarter, qualify for a deduction. Also any Federal taxes you paid with your tax return can be deducted. In doing so, you\u2019d be deducting taxes that you paid with last year\u2019s Federal return since that is the one filed during the current calendar year.<\/p>\n<p><strong>Louisiana:<\/strong> you can deduct any Federal taxes equal to your total Federal income tax liability after you have subtracted non-refundable tax credits found on line 55 of your Form 1040.<\/p>\n<p><strong>Missouri: <\/strong>you can deduct your Federal income tax liability from a Federal return. If you are required to pay an alternative minimum tax (AMT), you must subtract the amount as well as the total of certain refundable credits. The deduction threshold is up to $5000 for single filers, and $10,000 for couples who file jointly.<\/p>\n<p><strong>Montana<\/strong>: you\u2019re allowed to deduct all Federal taxes actually paid with cash. Similar to Iowa, the deduction is equal to Federal taxes you\u2019ve had withheld from your salary, along with <a href=\"https:\/\/www.etax.com\/blog\/2023\/12\/07\/surge-in-irs-penalty-underpayment-consequences-hit-gig-workers-and-consultants\/\">estimated tax payments<\/a> made, and any Federal taxes paid with the prior year\u2019s tax return during the current year. The deduction is limited to $5000 for single filers, and $10,000 for married filing jointly.<\/p>\n<p>In states with the deduction amount is that which you paid in cash throughout the year, you\u2019re required to adjust for Federal tax refunds you\u2019ve received.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>You are allowed to deduct state taxes on your Federal income tax return. Additionally, many states allow you to deduct any taxes you paid to other states. So it only seems logical that you should be able to deduct Federal income tax when filing your state return. However, only six of the 41 states with [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[126],"tags":[482],"class_list":["post-863","post","type-post","status-publish","format-standard","hentry","category-states","tag-federal-taxes"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Federal Income Tax Deduction: State Taxes - eTax.com\u00ae Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.etax.com\/blog\/2016\/03\/31\/federal-income-tax-deduction-state-taxes\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Federal Income Tax Deduction: State Taxes - eTax.com\u00ae Blog\" \/>\n<meta property=\"og:description\" content=\"You are allowed to deduct state taxes on your Federal income tax return. 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