Confused on State Returns

[garrapatta]

Filing as MFS (separated from my husband who is in UT).

I own a home which I rent out in UT and live and rent an apt. in CA (full-time resident). I am doing my UT return and claiming as non-resident since I did not work there in 2023, just rented my property and travel there to take care of the property. In 2023, my rental income was less than my expenses (repairs, property taxes, mortg. insurance, etc.) so all the deductions, I am at negative. 

1) Do I still need to file return with UT if my UT rental entry is negative due to deductions? If I still need to file with UT, what do I enter as UT income when it is asking me about rents and royalties income. Do I enter the income before all the deductions or what is after all the deductions (the negative one)? 

2) When I start on my CA return, it lists UT property under Income - Rental and Royalty Adjustment. It shows $0 but the property is still there. How do I ensure that CA does not tax me on my UT property income? 

3) On both Federal and UT state return in Turbo tax is showing standard/itemized deductions of $13,850 but on CA it is showing $5,363. I don't know why it is doing that? Any help would be appreciated. 

Last year I was part-time resident with UT and CA and I don't remember these issues. Thank you!

@MonikaK1 

@TomK 

[RobertB4444 · Accepted solution]

1. If your Utah income is negative then I wouldn't bother to file with Utah UNLESS you received a 1099 showing the amount of rent that you received for the year.  In that case you should file with Utah because they have no idea that your rental expenses are higher than your income unless you file.

2. As a California resident you are taxed on any income that you earn no matter what state you earn it in.  California offers a credit for any taxes that you pay to another state to reduce your California tax bill so if you ever do have to pay taxes to Utah you will get credit for the taxes paid.  But you will still have to declare the income in California.  This year that's a bonus because you have a loss so you get to take that in California.

3. California's standard deduction is lower.  $5,363 is the correct standard deduction for single or married filing separately.

@garrapatta 

[garrapatta]

I know this was just a question on turbotax community site (I already filed UT), but thank you SO much for taking time and responding. Next year if I am at loss, I will follow your advice. Thank you, Robert! @RobertB4444