Tonya is a cash basis taxpayer. In 2022, she paid state income taxes of $8,000 and property taxes of $5,500. In early 2023, she filed her 2022 state income tax return and received a $900 refund.

a.If Tonya itemized her deductions in 2022 on her Federal income tax return and her itemized deductions exceeded the standard deduction by more than $900, she must recognize $900 income in 2023 under the tax benefit rule.

b.If Tonya itemized her deductions in 2022 on her Federal income tax return, she should amend her 2022 return and reduce her itemized deductions by $900.

c.If Tonya itemized her deductions in 2022 on her Federal income tax return, the refund will not affect her 2023 tax return.

d.If Tonya itemized her deductions in 2022 on her Federal income tax return, she must amend her 2022 Federal income tax return and use the standard deduction.