The sale of land in Colorado would be entered on a Non-Resident Colorado return. The Income Tax Topics for Nonresidents lists Colorado-Source Income that is taxable to nonresidents. The chart includes Income from real and tangible personal property, including interest, rents and royalties, capital gains, and capital losses.
You would need to get from Michigan: Credit for Income Tax Imposed by Government Units outside Michigan.
Complete the Nonresident Colorado return first, and then the Michigan Resident return.
Thank you for the information on my Colorado property sale. My wife (filing jointly) also has a sale of land she inherited five years ago in Texas. I looked up Texas and they do not have capital gains tax. Does my state of residence, Michigan, require that I claim the capital gain on property sold in Texas?
Yes, all your income is taxable to your home state unless specifically exempt. Many times, it is taxable to the non-resident state as well.
We sold real estate rental property in California. Do we need to pay tax on that sale in our state of residence Michigan?
Yes, and you must also pay tax on it in California (CA). There is good news!
State Returns - Assumes both states require income tax returns to be filed: Prepare the nonresident state first.
Credit for taxes paid to another state is allowed by a resident state when the same income is being taxed to another state. Your resident state does not want you to pay tax twice on the same income. The credit that is allowed will be the lesser of:
To enter your sale in TurboTax, follow these steps. Start here on the federal and then look for the section in each state return.
Click this link for more information. Where do I enter Investment Sales?