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Level 2
posted May 15, 2021 4:56:24 PM

Adjustments for capital gains while filing state return

There's a question related to while filing state taxes for Short-term capital gains from Form 1040, Schedule D.

 

Do you need to report adjustments to any of the following types of income due to federal/Massachusetts differences?

 

When do we say yes for this ?

 

I see some adjustments in the 1099-B due to the Wash sale loss disallowed i think.

 

On federal it didn't ask anything related to it, do I need to do select yes for this?

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1 Replies
Alumni
Jan 23, 2023 8:05:21 PM

taxfile2020,

 

While it is true that MA taxes short term capital gains at a 12% rate versus a 5% rate for interest, dividends, and long term capital gains, TurboTax has that info already.  MA document https://www.mass.gov/doc/2022-schedule-d-is-instructions/download does show a couple of exotic edge cases that TurboTax would not automatically handle.  I doubt that any of those affect you.  

 

As to wash sales, that is and adjustment to the cost basis of the asset and requires no changes in MA from the federal treatment.  (https://answerconnect.cch.com/document/jma0109013e2c84f9268b/state/explanations/massachusetts/federal-base-gains)