CA Non resident tax return

Forum|Forum|7 years ago
November 16, 2018
4 replies
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CA FTB is withholding a significant amount of funds indicating we should have filed a CA Income Tax return several years ago since we own a rental property though we moved out of state the prior year. It's unclear why Turbo Tax didn't flag this given it knows our residency and it knows of the rental property. Should I just mail in a return with the income and expenses (which result in $0 income) and hope and pray they release our funds? Should Turbo Tax have generated a CA state return? We called the FTB and the lady told us to file and hung up on us. Thanks.

BarbL

Employee

Yes, you will need to continue to file a California return with the FTB each year as long as you have the rental property. Until you tell them otherwise, the state will assume you made a profit on the rental and will tax accordingly. A CA return with a copy of the federal return (showing the $0 income) should prompt them to release the funds.

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Stinkerbellkity

Employee

In determining your need to file a state return, the program uses the answers you give in the Personal information section. You would have needed to say you had income in another state and chosen CA. Since the net of your rental was zero, you may have incorrectly said no. You do need to file an should amend the prior year returns and send them to CA.

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Stinkerbellkity

Employee

You would amend to ad a new state.

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Stinkerbellkity

Employee

You would amend to ad a new state. You will need this CA return for prior years to determine the profit when you sell, as CA has different rules for depreciation that may become taxable to you when you sell, and also to record any passive losses you were not allowed to deduct in CA in years prior to selling.