Capital gains state tax

Forum|Forum|7 years ago
February 5, 2019
1 reply
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I sold a home in Florida but I’m a resident of a different state. Besides federal capital gains tax, there’s also a state tax. Which do I fall under? The state where house was sold or where I reside?

O

OldTaxDude

Employee

The answer is both. Your state of residence can tax all of your income, regardless of where it is from. If you have property or a business in another state, that state can tax income related to the business or property. To mitigate the double tax, your home state provides a credit for the tax paid to the other state. So, you end up paying the higher of the two.

Lucky for you, the other state is Florida, which has no personal income tax. So, you'll end up just paying tax in your home state.