How do I calculate capital gains partial exemption on the sale of my home for North Carolina taxes? I know how to do it for fed tax but need help with NC tax calculation

[cdmason1964]

We will be in our home 22 out of 24 months. Also, can I use Turbo tax for the capital gains partial exemption or do I need to use an accountant?

[DoninGA]

You can use TurboTax for a partial exclusion of the gain on the sale of a primary personal residence.

Click on Federal Taxes (Personal using Home and Business)
Click on Wages and Income (Personal Income using Home and Business)
Click on I'll choose what I work on (if shown)
Scroll down to Less Common Income
On Sale of Home (gain or loss), click the start or update button

Or enter sale of home in the Search box located in the upper right of the program screen. Click on Jump to sale of home

[DoninGA]

@SteamTrain Any comment on this for a North Carolina return?

[cdmason1964]

Thank you!  Do you know if Turbo Tax also has the same capability to calculate partial exemption for capital gains on the sale of a home when filling out state taxes for North Carolina?

[DoninGA]

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@cdmason1964 wrote:

Thank you!  Do you know if Turbo Tax also has the same capability to calculate partial exemption for capital gains on the sale of a home when filling out state taxes for North Carolina?

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Sorry no.  I am not familiar with North Carolina tax returns or the tax code in NC.

I will page a couple of our experts who should be familiar with NC tax returns

@SteamTrain  @NCperson can you help out here?

[SteamTrain]

@cdmason1964    @DoninGA 

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I had never dealt with that before, so I tried it out on a home sale gain, for living in a home 22 of 24 month minimum.

From what I see, NC starts with the Federal AGI as the starting point for the NC tax return....so IF the Federal form had a partial exemption for having lived in the home 22mo   (I used having to move due to a job more than 50 miles away)....then whatever is exempted on the Federal forms is automatically considered the same in the NC tax return.    No further adjustment is needed when working in the NC tax forms.

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My test was a tax return with a $240k gain, 22mo lived & owned....and the Feds only taxed ~$11k+ of the gain.  ( I had roughly figured it should be ~$20k taxed, but I'm not sure what miniscule details of dates & months are involved )

[NCperson · Accepted solution]

@cdmason1964 

the NC tax return begins with the Adjusted gross income (Line 11) of the federal return.  If you didn't have to report the gain on the federal return, then it is automatically eliminated from the NC return (because it was eliminated from Line 11 of the Federal Return).

NC doesn't have the concept of 'capital gains' - if that is what you mean.  All income is taxed at the same rate.  

oops, just saw @SteamTrain response.  I concur. 

[cdmason1964]

Thank you, I really appreciate it.

Have a great day!