IRS says it’s ‘looking into’ California inflation relief taxes; Kevin Kiley pushes for answer
Rocklin Republican Rep. Kevin Kiley issued a letter to the Internal Revenue Service Thursday, requesting clarity on whether the California inflation relief payments are taxable at the federal level.
This comes after questions to his office from constituents seeking help and The Bee’s report on Wednesday, detailing attempts to reach the IRS and tips on what taxpayers should do from a California certified public accountant.
Several readers have reached out to The Bee, asking whether they should claim the Middle Class Tax Refund as income on their federal tax returns. They are not taxed at the state level.
“Many of the 16 million residents of California who received the refund are unable to file a 2022 tax return because they do not have clear guidance as to whether to include this payment,” Kiley wrote to IRS Commissioner Doug O’Donnell, attaching The Bee’s story.
Last week, The Bee reached out several times to the IRS for information, with no response. After sending a follow-up to an IRS representative Thursday, The Bee received the following message:
“We are looking into this and hope to have something for you in the next few business days,” Robyn Walker, IRS media relations, wrote in an email reply. “We will reach out when we do.”
Raphael Tulino, an IRS spokesman, emailed The Bee a statement Friday afternoon, noting that the IRS is working with state tax officials “as quickly as possible” to provide information for taxpayers.
“There are a variety of state programs that distributed these payments in 2022 and the rules surrounding them are complex,” according to the statement.
For now, the agency is telling people to wait for guidance or “consult with a reputable tax professional.”
“For taxpayers and tax preparers with questions, the best course of action is to wait for additional clarification on state payments rather than calling the IRS,” it wrote. “We also do not recommend amending a previously filed 2022 return.”
