It depends. If the LLC paid the North Carolina (NC) state income tax on the gain from the sale, you should not have to file a NC return again on the same capital gain. In this case you would not have a gain to report or pay tax a second time to NC. If what you are saying is true you should file your resident return only for South Carolina (SC) and there should be no credit.
- Your statement: 'The LLC sold property this year, and the NC LTCG tax was paid'
- Confirm this with the person who prepared the LLC return.
- If the state tax was paid and applied to your wife's social security number (SSN) then her K1 would also show any state tax paid on her behalf and it would be included on your state return withholding or estimated payment. This seems unlikely.
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@pmtiger
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