Just to clarify the profits from the sale of an asset held for more than a year are subject to long-term capital gains tax. The rates are 0%, 15% or 20%, depending on taxable income, and filing status. So you need to focus on taxable income and not adjusted gross income. These are the rates.
|
|
|
|
Married filing separately
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Since you said you were going to be higher then the $94,050, I am not sure by how much, so net investment tax could apply as well. The net investment income tax (NIIT) is a 3.8% tax that kicks in if you have investment income and your income exceeds $200,000 for single filers, $250,000 for those married filing jointly or $125,000 for those married filing separately.
Your resident state California, will offer a credit for the taxes paid to Hawaii, on the California tax return that you file, so you may not owe California for this sale. The credit will not be the withholding tax on the sale, but the taxes you pay to Hawaii when you file both a California and Hawaii tax return in 2024.
I would suggest using Tax Caster to see what your tax position is with the sale of the house in Hawaii, prior to the last estimated tax payment for the year, which is January 15, 2025. Also you can adjust your W-4s, though there are only a few pay periods left in the year.
Thank you for your question @RaydeeohMan
All the best,
Marc T.
TurboTax Live Tax Expert
27 Years of Experience Helping Clients
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
