I sold s land parcel in DE; I am a resident of MD; to whom do I pay capital gains?

[AnnetteB · Accepted solution]

If the property was sold at a gain, you will pay capital gains tax on your Federal return.  You will also be subject to income tax on a non-resident Delaware return and income tax on your resident Maryland return for the sale of the property.

A non-resident Delaware return is required if you receive income from a Delaware source.  Work on this return before you complete your Maryland return.

Your resident Maryland return will also include the income from the sale transferred from your Federal return.  However, since Delaware will be taxing that same income, you should be able to get a tax credit on the Maryland return to help offset the taxes paid to Delaware.  Watch for the screen titled “Other State Tax Credit Summary” when you are working through the Maryland return.  Click Edit beside the entry and verify the information from the Delaware return to calculate the credit. 

[pillefamily]

Thanks for the quick response!