how to generate sch d (540) for ca

[Ronnie2020]

how to generate sch d (540) for ca

[George4Tacks]

What does it say at the top of that form? "Do not complete this schedule if all of your California gains (losses) are the same as your federal gains (losses)."

[Ronnie2020]

I understand but CA gains are not the same as Federal - Passthrough K-1 Lines 4(a) and 4(c) - no corresponding State box!

[George4Tacks]

Did someone loose the corresponding state K-1? If you know the state is different are you not able to make an entry is state, if different? 

Give more information and you may get more help, e.g. What flavor is that K-1 that has lines 4(a) and 4(c). Volunteers here are smart, but we are a bit lazy and hate looking up things those that post should include.

[Ronnie2020]

The taxpayer lives in FL so files a Non Resident CA return as she has some CA tax deducted from an annuity, so no State K-1.

The K-1 is from a  Survivor's Trust.  Lines 4(a) is capital gains from sales of properties in FL and 4(c) is 1250 gain also from sales of properties in FL.

Thanks very much indeed for your assistance.

[joshuabarksatlcs]

This is how I understand your given facts:

FL resident; CA full-year Non-resident

1099-R showed an amount for CA withholding.  I presume the distributions are NON-taxable for CA, but it really doesn't matter for the issue you raised (how to generate Sch D).

1041 Sch K-1 showed capital gains for sale of FL property.  Thus NOT CA sourced.

In Screen 20, Line 4(a) enter the capital gain and specify US (my presumption: NO FL income tax return is filed, thus the source would be US, and not FL).

Sch D for CA would be generated showing the same CG amounts as federal - this is how CA NR returns work.  

The magic for CA adjustment happens on Sch CA NR where you should see zero amount under CA Source (the right most column, i.e. Column E) for Part II Line 7. 

However, if for some reason the annuity is subject to CA tax, you would see the CA sourced amount on Part II Line 5 Col E. 

You would see the amounts under Column D (Total amount using CA Tax Law) identical to federal amounts under column A.

There would be numbers under Column B or C IF there was a difference between Fed and CA amounts, resulting a different amount (from federal) for Column D.  This would be applicable if the item(s) is/are California sourced.   For example if there was a R/E sale in CA and the Fed basis was different from CA.

In your case, the Sch D for CA would NOT have different amounts from federal, because there would NOT be a different amount for Column D. 

I hope this helps.

[joshuabarksatlcs]

RE: The magic for CA adjustment happens on Sch CA NR where you should see zero amount under CA Source (the right most column, i.e. Column E) for Part II Line 7. 

In case you're not familiar with CA NR returns, I should also add that the total of Col E on Sch CA NR is the total California sourced income, which is carried over to Line 35 of CA 540 NR (via Part IV Line 5) in determining the CA tax for the NR.  This is how it works.  Col D addresses the Fed/CA differences and Sch E addresses the CA source income.  The two columns could be confusing if you don't deal with 540NR's regularly. 

[Ronnie2020]

Thanks very much, BUT I still don't get a CA schedule D.  I don't really need one (or want one!) but I have a critical diagnostic which will not let me efile without a CA schedule D and I really don't want to file the CA return on paper.  Thanks again for any further suggestions.

[George4Tacks]

Use -1 (negative one) for the State (CA) if different for all Capital Gain items and see what happens.

[Ronnie2020]

Thank you very much.  Really appreciate your help.

[joshuabarksatlcs]

I don't know why you would get that diagnostic.  CA Sch D is not a requirement for e-filing; so, I have NO clue why your efiling wouldn't go thru without the CA Sch D.  It doesn't make sense to me from the angle of CA tax e-file processing.

Entering -1 for the state amount would trigger Sch D for CA - yes - but if your client had CA source income or CA tax, the CA tax computation would be off/wrong.  Basically CA NR tax is computed based on the percentage of CA source income applied to the CA tax (Line 31 on 540NR).  By entering -1, you would change the computation of Line 31. 

However, if your client didn't have significant CA tax, who cares, right?     

If the accuracy for your client's CA tax is important, consider changing the state number by $1 instead of entering -1.