Norma, who uses the cash method of accounting, lives in a state that imposes an income tax. In April 2014, she files her state income tax return for 2013 and pays an additional $1,000 in state income taxes. During 2014, her withholdings for state income tax purposes amount to $7,400, and she pays estimated state income tax of $700. In April 2015, she files her state income tax return for 2014, claiming a refund of $1,800. Norma receives the refund in August 2015.

a. Assuming that Norma itemized deductions in 2014, how much may she claim as a deduction for state income taxes on her Federal return for calendar year 2014 (filed in April 2015)?

b. Assuming that Norma itemized deductions in 2014, how will the refund of $1,800 that she received in 2015 be treated for Federal income tax purposes?

c. Assume that Norma itemized deductions in 2014 and that she elects to have the $1,800 refund applied toward her 2015 state income tax liability. How will the $1,800 be treated for Federal income tax purposes?

d. Assuming that Norma did not itemize deductions in 2014, how will the refund of $1,800 received in 2015 be treated for Federal income tax purposes?