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March 25, 2023
Question

Offsetting MO non-resident capital gains on rental property sale

  • March 25, 2023
  • 1 reply
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I am a NJ resident and sold a Missouri rental property in 2022 generating a capital gain. I owned the rental property in my name as a sole proprietor (not an LLC). When filing non-resident Missouri income tax, can I offset the rental property capital gain with capital losses realized from selling stock investments that have no connection to Missouri?

 

For illustrative purposes, suppose I had a $60,000 capital gain on the sale of the Missouri property, offset by a $40,000 capital loss from stock investments that had no Missouri connection.

 

In the Missouri software, TurboTax is asking me to "enter the portion of the $20,000 capital gain" I received from Missouri sources.  But the $20,000 capital gain seems to have been pulled from my Federal return, where my capital losses were already counted as an offset.  

 

So my question is: what amount would I enter as the Missouri portion of the capital gain?  Would I look only at the gain on the Missouri property and enter $60,000?  If not, how would I calculate the portion of the $20,000 that is from Missouri sources?

    1 reply

    March 26, 2023

    For Missouri source income, you will want to enter the gain from the sale of the property only.