<p>Our house has been paid off for a year now accually, we plan to take this Refund & buy a newer Suburban, ours is almost 20 yrs old & literally falling apart. Now I am confused again.... so we are supposed to count our State tax Refund in the next years as income?? We have always gotten back about $1,000 each year and never did this. We get "Tax Forgiveness" (I believe that is what it is called) or something due to dependants & income. You must be talking about something else, mentioning those deductions , we don't deduct anything but our kids & 401K on any taxes, Federal or state (I don't think you are allowed to deduct that on there?). I say we are not bright because we have been socking $3,000 to $4,000 a year into an 401K plan at work-picking certain so called "safe" investments (we only have so many to choose from) and over apprx 7 years, it is only approx $28,000 right now. It seems to me, when you read about investments, they make it sound like you will be making a mint, how it really adds up, where as it seems to us, we might have been better off doing CD's. Investing in something we do not understand does not seem to work for us--at all. We continue the 401K just because we can deduct that amount from being taxed every year, not because it is doing well. I guess I need to take a course on how to interpret & change mutual funds or whatever within a 401K. I've tried to read & understand, I just do not get it.</p>