William,a Single Taxpayer,has $3,500 State Income Tax Withheld from His

Multiple Choice

William,a single taxpayer,has $3,500 state income tax withheld from his paychecks in 2016.When he filed his 2016 state income tax return on April 15,2017,he calculated and received a $600 refund.The $600 refund was received on May 27,2017.What are the federal tax effects of the state income tax events of 2016 and 2017?
I.If his itemized deductions including state income taxes total $6,600 in 2016,William includes $300 in gross income for 2017,
II.If he did not itemize his deductions in 2016,none of the refund is included in 2017 gross income.
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A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements are correct.
D) Neither statement is correct.