out of state taxation on sold investment property

Forum|Forum|2 years ago
January 23, 2024
1 reply
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Hello, I live in Texas where there is no state income tax. I sold a second home in Alabama in 2023. I do not have any rental income on it for 2023, just 2022 via airbnb which I paid Alabama tax for. I have paid federal tax already on the capital gains on the home sale (ended up not being a whole lot since I had a good bit of capital gains losses from stocks)

My question is, do I also have to pay Alabama taxes on my net capital gains (house profit minus stock losses?)

Vanessa A

Yes, you will need to file a Non-Resident Alabama return and potentially pay taxes on the sale of the home since the house you sold was in Alabama. This would be considered Alabama source income and taxable to the state of Alabama.

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