Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.

dennis33 — Tue, 08 Sep 2020 16:58:23 GMT

Do I need to pay estimated WI capital gain now?

Re: Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.

Critter-3 — Tue, 08 Sep 2020 18:13:22 GMT

Estimates are not needed (unless they are required at closing) IF you either didn't file a WI return for 2019 or your tax liability was zero.

Re: Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.

Opus 17 — Tue, 08 Sep 2020 18:54:56 GMT

If you have a lump sum of income you will generally be required by the IRS to make an estimated tax payment by the due date for the quarter. For property sold on 8/14, the payment is due 9/15.

Although the estimated payment is always required by law, you won't pay a penalty on your federal return so long as one of these three statements is true:

you owe less than $1000 when you file your return
your total payments into the system (from withholding and estimated payments) is at least 90% of your tax liability for 2020
your total payments into the system (from withholding and estimated payments) are at least 100% of your tax liability from 2019 (110% of 2019 liability for certain high income taxpayers.)

So you may need to make a payment, it will depend on your other income and withholding and last year's tax return.

You will owe a penalty in Wisconsin unless you have paid into the state system at least 100% of last year's tax liability. That should mean that if you are not a WI resident and did not file a WI return last year, you won't be penalized this year for not making an estimated payment.

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Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.

Re: Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.

Re: Sold our WI lake property on 8/14 with estimated capital gain of $217,000 Must we file WI return for the capital gain and the estimated tax now? Also, estimated Fed.