IRS Clarifies Whether 2022 GA Inflation Relief Payments Are Taxable

GEORGIA — The Internal Revenue Service has given Georgians who received state-issued inflation relief payments the go-ahead to file their 2022 tax returns without worrying they’ll have to pay taxes on the income.

The agency had asked taxpayers in multiple states to hold off on filing if they received an inflation relief payment or refund from their state in 2022.

The IRS said after a review Friday that it would not challenge the taxability of payments made in California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania and Rhode Island.

Some Alaska taxpayers may also be able to avoid paying federal income taxes on certain payments.

In those states, the agency said, state payments are not taxable because they were made “for the promotion of the general welfare or as a disaster relief payment.”

Georgia Gov. Brian Kemp rolled out his cash assistance program in September, which provided one-time payments of up to $350 for recipients of Georgia's Medicaid, Temporary Assistance for Needy Families and Supplemental Nutrition Assistance programs. The payments were funneled through the Department of Human Services using pre-loaded cards before the department switched to checks. The funding came from the State Fiscal Recovery Fund.

Some people who live in Georgia, Massachusetts, South Carolina and Virginia will have to report state payments as income. It depends on whether they claimed the standard deduction, or itemized deductions but did not receive a tax benefit, the agency said.

The 2022 federal income tax filing deadline is Tuesday, April 18.

• Related: What To Know About Filing Your 2022 Tax Return