Should I file state return in state of second home sale in which there are no capital gains and no salary/wage income?

[taxes1492]

Turbo Tax state return for non-resident state where sale took place will not allow me to proceed as Non-Resident and then since there are no capital gains, says the return is the amount of the sales tax paid for the house sale.  This cannot be correct.

[AnnetteB6]

If there was not a capital gain as a result of the sale, there would be no income to report on the state return.  So, you may not be required to file a state tax return at all.  

Just to be sure, please respond with what state the property is in and your resident state, plus any other information that may be helpful for someone to research a bit more.

[taxes1492]

Thank you.

The sale was in WV, and residency state is VA.   I did a WV state return in TurboTax (not submitted) but because of the sales tax I was unable to indicate non-resident form; TT is calculating a refund of the paid sales tax and I do not believe this is correct.  

[KrisD15]

To clarify just a bit more, 

are you referring to the state transfer tax?

Did you report the sale on the federal Section of TurboTax? Did you also report the transfer tax as a selling expenses?

What type of home was this? Rental, vacation? 

[taxes1492]

The land and home were personal use for vacation.

The Settlement Statement (HUD-1) shows on line 506, "WV State Tax Dept." and an amount.  I input that amount* as sales taxes paid due to a search result on West Virginia State Tax, TSD-389:

The “amount to be withheld” is either:
1. 2.5% of the total payment to a nonresident individual or entity who sells or exchanges real
property located in West Virginia, or
2. 6.5% of the estimated capital gain derived from the sale or exchange.
• The amount of tax withheld must be paid to the real estate reporting person before the deed or other
instrument transferring title to the realty is presented for recordation or filing in the county clerk’s office.
The withheld amount must be remitted to the State Tax Commissioner within 30 days after it is
withheld.

* I entered the information in the investment income section since this was a second home and I received a 1099-S.  After entering the information on the "Tell us about this sale" page, the next page includes State tax withheld, State, and State ID Number, all of which I entered with information found on the Settlement Statement.
____________________

[ShirlynW]

Yes. You should file a state return for West Virginia.

According to the tax.wv.gov, A nonresident individual or nonresident entity that sells real or personal property located in WV must file a WV income tax return. The appropriate income tax return must be filed for the year in which the transfer of the real property occurred. The due date for each income tax return type can be found in the instructions to the specific income tax return

For more information