Other state source income-if client sells his house in a state that doesn't have tax, does the state he moved to, tax the income on the sale?

[Just-Lisa-Now- · Accepted solution]

Resident state will most likely tax all income...is this what youre asking?

Or did they sell the house in the non-tax state, then move out of that state?

[Mike12321]

Yes they sold the house in the non-tax state - so I was hoping that we could escape tax on the sale, there was unrecaptured 1250 gain.

[Just-Lisa-Now-]

So you're only doing  a part year return for the state they moved to, right?  That income while in the state without tax shouldn't be taxed in the new state.

[Mike12321]

Yes!!! Thanks so much for confirming what I thought. --And answering so quickly.

[Just-Lisa-Now-]

Use the part year allocation worksheet at the bottom of the federal information worksheet to allocate the income to the correct states.

[Mike12321]

Thanks again! I have previously allocated income per months lived in each state for some income, so I believe I can do that again for RR pension, social security etc that doesn't indicate a state on the 1099.