Discussion:Sale of California Home
From TaxAlmanac
| Revision as of 20:20, 16 February 2009 KatieJ (Talk | contribs) (That's moot, Mic) ← Previous diff |
Revision as of 20:21, 16 February 2009 Donniecastleman (Talk | contribs) (When I say drop) Next diff → |
||
| Line 24: | Line 24: | ||
| Did the client get a letter from FTB or a filing enforcement Notice of Proposed Assessment? That may also affect the form of your response.}} | Did the client get a letter from FTB or a filing enforcement Notice of Proposed Assessment? That may also affect the form of your response.}} | ||
| + | |||
| + | {{ForumReplyPost|UserID=Donniecastleman|Date=16 February 2009|Text=When I say drop down, I mean that the federal is top priority and then the state comes in a close second. I'm assuming that we simply have to report the gain and zero it out. And that's a really good idea about reporting home sales on Schedule D just in case something goes awry on reporting by the real estate industry.}} | ||
Revision as of 20:21, 16 February 2009
Discussion Forum Index --> Advanced Tax Questions --> Sale of California Home
Discussion Forum Index --> Tax Questions --> Sale of California Home
Donniecastleman (talk|edits) said: | 16 February 2009 |
| Hi California preparers,
Someone about to become my tax client sold a house in 2005 in California and got a letter asking for 21K in taxes on gain on the sale of the home, does the 250K exclusion on the sale of a home for a single taxpayer drop down to California state? I'm about to dig into my software and see if there's a specific form but wanted to give him an answer ASAP, thanks! | |
Donniecastleman (talk|edits) said: | 16 February 2009 |
| Hmm, sources say no from what I'm reading. | |
| 16 February 2009 | |
| Donniec - not sure what you mean by "drop down" but the 250k exclusion rules in Cal are the same as the fed. Was the sale shown on the schedule D with the exclusion also shown? Or was it just not reported because it qualified for no taxable gain? I know the rules say if there is no taxable gain after the exclusion you do not need to report it but we always show it on the D anyway. | |
| February 16, 2009 | |
| Donnie -
If excluded for Federal, should be for CA also. But, Calif is in a world of hurt financially right now....and seems to be grasping at straws/trying to intimidate folks into paying when they probably don't. Maybe just a legitimate error. Do your client's have a 'non Calif' address? Was the return when the sale was reported a CA Non-resident? Just grasping here - if you need help, I have a taxpayer advocate number for the Franchise Tax Board somewhere... | |
Michaelstar (talk|edits) said: | 16 February 2009 |
| Actually, I am unaware of any state that does not comply with the sec 121 exclusion that assesses taxes. Obviously, for those states that do not assess individual taxes this is a mute point. | |
| 16 February 2009 | |
| That's moot, Michael, not mute <G>.
Donnie, was your client a California resident in 2005? If he was a nonresident, did he file a nonresident California return? If no return was filed, the easiest thing to do probably is to file a 2005 540NR reporting the sale and the exclusion. My guess is that the FTB has notice of the sale but no information with regard to basis or eligibility for the exclusion. Did the client get a letter from FTB or a filing enforcement Notice of Proposed Assessment? That may also affect the form of your response. | |
Donniecastleman (talk|edits) said: | 16 February 2009 |
| When I say drop down, I mean that the federal is top priority and then the state comes in a close second. I'm assuming that we simply have to report the gain and zero it out. And that's a really good idea about reporting home sales on Schedule D just in case something goes awry on reporting by the real estate industry. | |
