Do I file income from an out of state rental property in the state of the rental or the state I live in?

Question

I live in California, but turned my NC home into a rental property in 2006. I have received rental income but I am not sure if I file that as income in the state I live in or the state that the property is located? I have to file a CA state return since I work here, but do I need to file a NC state return for the rental as well?

Answer 1

For the 2006 year you would file state taxes with NC, however depending upon how you file and what the actual income proceeds were is really going to make difference. If you had a loss then you would not have to file, but if you had a gain then you will. Keep in mind you can still file with a loss and use as a tax write off. You may have done this already but change the title to an LLC so you are legally protected and you may want to consider refinancing the house and recieving cash out. You can visit www.tlgbanking.com to view rates and an application. Good Luck

Answer 2

The majority of the time, taxes are paid where the money is earned, not where you live. Some states have reciprocal agreements, allowing people who live in one state but work in another to pay taxes only where they live. This is most common with neighboring states, but there are some exceptions. To the best of my knowledge, NC and CA do not have a reciprocal agreement, therefore you would pay taxes to NC where the property is located.

Answer 3

I would assume that you would need to file in the state that you live, and on the tax paper it has a section where you can fill out property, or any extra income stuff like that.
Im not sure though.

Answer 4

you're able to have been submitting CA non resident tax returns each 3 hundred and sixty 5 days. YIKES! you may flow decrease back and amend as much as 3 years tax returns. you may might desire to withhold state taxes in CA is while you're making a earnings, yet your losses from federal SCH E could offset that.