Arizona- question about the long term capital gains on form 140 and form 140 X

[Ionnowhy]

On AZ form 140, it asks for total net short term gain or loss on line 21, total net long term gain on line 22, and total net long term capital gains from assets acquired after December 31, 2011. Let us assume the following:

Line 21: -20,000

Line 22: +10, 000

Line 23: + 5,000

For federal tax purposes, one would owe no taxes and have a capital loss carry over of -20,000 + 10,000 = -10,000.

However, following the form instructions for form 140 or 140X, it lowers the tax owed by Line 23 * 25%  (on line 30)* tax rate even though the AGI shows no capital gains as row losses offset the gains. Is something wrong or is this the right way to file?

[DMarkM1]

Yes.  This is correct.  AZ, irregardless of the overall net capital gain/loss, allows a deduction for part of any net long-term capital gain on assets acquired after Dec 31, 2011.  

[Ionnowhy]

@DMarkM1 

Thank you.

When calculating the net long term capital gains, do we include losses from section 1256 contracts and straddles on form 6781 since a portion of these are considered long term capital losses and net them against the gains in form 8949 (see below)

(or )

Do we only state the long term capital gains from part II of form 8949 (sales and other dispositions of capital assets)?

As an example if form 8949 has net LTCG of 10000 but 6781 has an attributed LTC loss of 15000, do I enter 10000 on the AZ tax form 140 line 23 or leave it at 0?

Thank you for your help.