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BUSINESS INCOME ALLOCATED TO STATES
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nolanm
Level 4
03-02-2024
08:19 AM
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Hi all
Client has $350k net income on Sched C. Lived 1/2 NY 1/2 CA. Allocated 50% of $350k to each state. SE taxes and SEP contribution are $80k.
Both NY and CA calculate state tax on AGI from federal after the $80k deduction. NY tax is allocated as 50%, makes sense. CA has an allocation sheet and Proseries defaults to deducting this $80k, so that CA share of income reduces to below 50%.
This is double dipping right? I should set the CA allocations of SE taxes and Sep contribution to zero, as CA tax is already after the $80k deduction?
Sorry if this is a bit basic, my head is spinning as there are a lot of other moving parts in this return.
Thanks for any help Nolan
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