anoop wrote:

- quote -

The VLF is a personal property tax. As such it is tax
deductible on the both the federal and state tax returns.
As you received full benefit for the tax deduction in 2003,
you are correct that the refund should be entered as Other
Income on the 2004 1040. It will flow to the CA 540 as part
of your federal AGI and there should not be any adjustment
made for it on the CA return if you received the full
benefit of the tax deduction in 2003.

--
Alan
http://taxtopics.net

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At the end of 2003, I was sent an invoice for a VLF fee that
I paid. A couple of months later, I received a refund for
most of the amount. However, I did take the full deduction
in 2003.

I'm using Turbo Tax to do my taxes this year. I reported
the VLF refund as "other income" on the federal since I
couldn't find a better place for it. On the CA return,
Turbo Tax has an explicit category for VLF refund. If I
check that and enter the amount, I'll probably be double
taxed on that amount. How should I handle this? Should I
just ignore the VLF refund question in the state return?

Thanks in advance for any help with this.

Anoop

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