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If I've lived the last 20+ year, then move out in the first month of the year, it was my primary residence at the time of closing of the sale.
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Originally Posted by Kefir King
Many of the replies seem to assume that the NYC house is his PRIMARY RESIDENCE. Can it be his primary residence if he spends only 1 month of the year there?
We already established it was his primary.....the real question was does he owe the state anything...he does not
He does if his capital gain from the sale is more than $250k (single filer) or $500k (married couple). Capital gains in excess of that are taxable by IRS, NY State, and by the new home state (if the new state has state tax, and if he is a full-year resident in that state. He would not have to actually pay double tax in the new state, because he would get credit for payment to NY, but he would have to report all his annual income to his new home state if he is a full-year resident of that new state. Or he could sell his NY place on June 30, and file part-year resident state tax returns in both NY for 6 months and the new state for the second 6 months, in which case the income for each half of the year is reportable to each state, without overlap).
He does if his capital gain from the sale is more than $250k (single filer) or $500k (married couple). Capital gains in excess of that are taxable by IRS, NY State, and by the new home state (if the new state has state tax, and if he is a full-year resident in that state. He would not have to actually pay double tax in the new state, because he would get credit for payment to NY, but he would have to report all his annual income to his new home state if he is a full-year resident of that new state. Or he could sell his NY place on June 30, and file part-year resident state tax returns in both NY for 6 months and the new state for the second 6 months, in which case the income for each half of the year is reportable to each state, without overlap).
He has led me to believe his gains are under . He never asked about being over and knows of the exclusion
The idea would be to move to a no tax state (NV being the prime candidate.)
Quote:
Originally Posted by elnrgby
He does if his capital gain from the sale is more than $250k (single filer) or $500k (married couple). Capital gains in excess of that are taxable by IRS, NY State, and by the new home state (if the new state has state tax, and if he is a full-year resident in that state. He would not have to actually pay double tax in the new state, because he would get credit for payment to NY, but he would have to report all his annual income to his new home state if he is a full-year resident of that new state. Or he could sell his NY place on June 30, and file part-year resident state tax returns in both NY for 6 months and the new state for the second 6 months, in which case the income for each half of the year is reportable to each state, without overlap).
Likely (hopefully) the gains would be over.
Quote:
Originally Posted by mathjak107
He has led me to believe his gains are under . He never asked about being over and knows of the exclusion
Then you will owe taxes on both federal and ny state regardless where you live , on the overage. Ny gets their due no matter if you live here or not ...my son lives in jersey and pays taxes on all our nyc real estate that we hold as a partnership
The idea would be to move to a no tax state (NV being the prime candidate.)
Likely (hopefully) the gains would be over.
In that case, you would file the IRS tax form, and NY non-resident state tax form (assuming property sale in early Jan, and full-year residence in NV), each including Schedule D. In that schedule, you would compute your taxable capital gain for the IRS, which would be the same capital gain taxable by NY (ie, any gain greater than $250/500). Nothing to file in NV.
If you move in early Jan, in the NY non-resident tax form there is a question whether you maintained a place of permanent abode in NY during the tax year. I think you would still have to check off YES, but the next question is how many days you spent at that place during the year (in which case you would write 4 days, if you sold the property on Jan 4. You can spend up to 182 days per year at your NY property and still be considered a non-resident of NY if you maintained a full-year home in a different state).
Irs instructions
Do not report the sale of your main home on your tax return unless:
You have a gain and do not qualify to exclude all of it,
You have a gain and choose not to exclude it, or.
You have a loss and received a Form 1099-S.
If you did have a gain to report then it goes on schedule d and 8949
They way it's been described here, it doesn't matter too much when I'd move vis-a-vis the proceeds from the sale. If I move early enough, my other income (at least after the move) shouldn't be taxable by NYS/C.
Quote:
Originally Posted by elnrgby
In that case, you would file the IRS tax form, and NY non-resident state tax form (assuming property sale in early Jan, and full-year residence in NV), each including Schedule D. In that schedule, you would compute your taxable capital gain for the IRS, which would be the same capital gain taxable by NY (ie, any gain greater than $250/500). Nothing to file in NV.
If you move in early Jan, in the NY non-resident tax form there is a question whether you maintained a place of permanent abode in NY during the tax year. I think you would still have to check off YES, but the next question is how many days you spent at that place during the year (in which case you would write 4 days, if you sold the property on Jan 4. You can spend up to 182 days per year at your NY property and still be considered a non-resident of NY if you maintained a full-year home in a different state).
Could the problem of double taxation come up if you sell in NYC then move to a state that has an income tax?
I'm thinking, sell NYC Jan. 4, file the necessary tax paperwork demonstrating you sold in NYS and then deposited the money in a bank branch in NY then you moved. Presume this is a national bank with branches in the new state.
Your first full day of residence in the new state (ie., the following day), you will have this income from the sale, but it wasn't earned while you were living in the new state. If you then get interest in the account while in new state, that would be income while living in the state.
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