IRS issues guidance on state tax payments

During 2022, 21 states issued payments to taxpayers for either disaster relief or as a general welfare stimulus payments.  In July of 2022 Oregon issued checks of $600 to individuals and families who had qualified for the Earned Income Credit on their 2020 income tax return.  There has been some confusion about the treatment of these payments on your 2022 federal income tax returns.  The IRS initially requested that taxpayers who had received these payment hold off on filing until they could make a determination as to the taxability of the payments.
The good news is that late last week, the Internal Revenue Service determined that "in the interest of sound tax administration" and other factors, taxpayers in these states will not need to report these payments on their 2022 tax returns.   We are now cleared to file returns for these taxpayers.