No. But if you live in one of the states that allows a state deduction for federal taxes and you took such a deduction, you may have to claim it on your state return.
No its not taxed. When you receive your refund, you will notice that their nothing withheld from your refund of any sort. You definitely do not have to report your refund to the IRS-its your money...
By having your employer withhold more federal income tax from your gross pay and decreasing your net take home paycheck.You would have to fill out a new W-4 form and give it to your employer payroll...