In 2021, Jacks employer withheld $1,200 from his wages for state income tax. Jack claimed the $1,200 as an itemized deduction on his 2021 federal income tax return. Because of a vari-ety of losses incurred by Jack, he reported a negative taxable income of $32,000 during 2021. The state refunded the $1,200 during 2022. Jack will not have to report the $1,200 as gross income on his federal return. Jack received no tax benefit from the deduction, as he would have owed no federal income tax in 2021 even without the deduction.