rental property

[CC200]

I am a resident of NJ and have rental property in North Carolina, I have loss for 7 years  and  net positive rental  income of around 3100 for 2023 . North carolina has no place on D400 or schedules where Loss carry forward is reported. When I take the loss carry forward and the positive income into consideration I am still overall loss of 4000+ carry forward . 

Do I report this rental income from NJ  as 0 or 3100  for north carolina source of income? Do I need to fill the NC NOL work sheet?   

[DMarkM1]

The NC income is going to be zero until the passive loss carryover is used up.  So there will not be any NC tax liability and thus no credit for taxes paid to another state on your NJ resident return.  You do not need to complete the NC NOL schedule as the net rental income is included in the adjusted gross income already.  When completing the NC Schedule PN, column B line 11 will be zero until the passive loss carryover is used up and your Schedule E shows a gain.     

[CC200]

Thank you. Do I report this rental income on NJ1040  as 0 or 3100  since NJ does not allow passive loss carry forward ?

[DMarkM1 · Accepted solution]

Yes, the NJ rental income will be $3100 as the carryforward losses do not factor in.