Sale of rental property in a non resident state

Forum|Forum|5 years ago
March 10, 2021
6 replies
36 views

My client sold a rental property and is reporting a gain of $155k in his tax return.

He lives in NY but the property sold is located in NJ and sold in NJ.

I am not being able to exclude this gain in his NY taxes, even though I am reporting this as taxable in his NJ NR return. So proseries is prompting me to have him pay taxes for this gain in both states.

He only needs to pay taxes in NJ, correct? How do I mark in his NY tax return?

PS. he also has a W2 form from NY for $25k.

Thank you.

ProSeries Professional

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sjrcpa

Level 15

A NY resident pays NY tax on all his income. He should be able to get a credit for tax paid to NJ on the doubly taxed income.

The more I know the more I don’t know.

sjrcpa

Level 15

I thought I heard an echo.

Rental Income in a different state - Intuit Accountants Community

The more I know the more I don’t know.

PATAX

Level 12

Sjr, I was typing that message in at the same exact time that you were typing your messaging in... the second that I posted it I then saw your message... So it is actually not an echo but it could mean that we are cut from the same cloth, as the old saying goes.

PATAX

Level 12

let me preface my remarks by stating that I am not an expert on those two states... But Common Sense tells you that you should not have to pay tax twice to two different states for the same transaction... So somewhere on the return you may be able to find a location to exclude the income or to give you a credit for the tax paid to the other state.. Multiple state returns are always a challenge, and you may have to ask the client if they wish to mail the two state returns if you cannot correct e-filing errors. Also sometimes one state wants to see the tax return that you filed in the other state.... Just my opinion