For people leaving California, can capital gains on stock be calculated using the resident to nonresident ratio of days, or must I use the date the stock was sold?

[mikewrley]

TurboTax allows both options, but I'm not sure the California Franchise Tax Board does.

[TomYoung]

Typically, realized capital gains are taxed by the state in which you are a resident at the time of the stock sale.  Why do you think you have to do some allocation?

[mikewrley]

Turbotax gives the option to either allocate the capital gains on share sales by the date they were sold OR based on the number of days in the tax year you were a resident of California.  Despite Turbotax allowing the capital gain allocation based on the percentage of the year you were a resident of California, I can't find any guidance that California actually permits a taxpayer to do this.

[pemoi1982]

Did anyone resolve this doubt?

Thank you

[RobertB4444]

Use the date of the sale.  If you were a resident when you sold it it's taxable to California.

@pemoi1982 

[pemoi1982]

Thanks,

What about if I have a capital loss after I left CA, but I am still US resident?

Scenario:

Jan-Jul: resident in CA, capital gain +1000

Aug-Dec: resident in Foreign country: capital loss -1000.  Declared in Federal Tax return as I am US resident

Can I use that capital loss to reduce my gains in CA?

Thanks a lot for your help !

[pemoi1982]

BTW I found on https://www.ftb.ca.gov/forms/2024/2024-540nr-d-instructions.html:

"Columns C and D should be completed taking into account the dates of the transactions. For column C, multiply the amount in column A by the number of days you were a resident divided by 365 days."

So it looks that in my example the capital gain, $1000, can be reduced by doing: (1000 * 365) / (days-of residency) ?

Is this correct?

Thanks again !

[DaveF1006]

It is determined by ($1000)(days of residency/365)  For an example, If you lived in California 100 days, your capital gains is determined by $1000 X 100/365 = $274.