Sale of rental property in a non resident state

[ddh2020]

My client sold a rental property and is reporting a gain of $155k in his tax return.

He lives in NY but the property sold is located in NJ and sold in NJ.

I am not being able to exclude this gain in his NY taxes, even though I am reporting this as taxable in his NJ NR return.  So proseries is prompting me to have him pay taxes for this gain in both states.

He only needs to pay taxes in NJ, correct? How do I mark in his NY tax return?

PS. he also has a W2 form from NY for $25k.

Thank you.

[sjrcpa]

A NY resident pays NY tax on all his income. He should be able to get a credit for tax paid to NJ on the doubly taxed income.

[PATAX]

let me preface my remarks by stating that I am not an expert on those two states... But Common Sense tells you that you should not have to pay tax twice to two different states for the same transaction... So somewhere on the return you may be able to find a location to exclude the income or to give you a credit for the tax paid to the other state.. Multiple state returns are always a challenge, and you may have to ask the client if they wish to mail the two state returns if you cannot correct e-filing errors. Also sometimes one state wants to see the tax return that you filed in the other state.... Just my opinion

[sjrcpa]

I thought I heard an echo.

Rental Income in a different state - Intuit Accountants Community

[PATAX]

Sjr, I was typing that message in at the same exact time that you were typing your messaging in... the second that I posted it I then saw your message... So it is actually not an echo but it could mean that we are cut from the same cloth, as the old saying goes.

[ddh2020]

thank you.  Yes i do not see anywhere in the NYS return a box to allocate income for residents or claim the credit. 

I have done it in the past where a person lives in NJ and works in NYS and NJ does have that option in box 32 to claim credit.

its very confusing..

[Brother Jack]

NY Credits for taxes paid to another State are calculated on NY Form IT 212R. PS should handle this after you calculate the NJ return first.