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j0707
New Member

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

I know if you don't make income in Colorado and you are non-resident, you don't need to file non-resident Colorado state tax return. I am not Colorado resident but I have a rental property with passive lost for 2015. I can deduct from future profits or when I sell the property. I don't know if not filing Colorado taxes will this have an effect of deduct suspended passive losses in the future. Are suspended loss carryovers tracked on Federal Taxes or State Taxes as well?

10 Replies
maglib
Level 10

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

Not a resident of Colorado, but received income from sources within Colorado; and • Are required to file a federal income tax return with the IRS for this year.

Sadly Colorado has no minimum threshold so yes you must file a return as a nonresident with rental income regardless of it being a loss. 

1285
Returning Member

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

if there is no source of income, shouldn't filehttps://www.colorado.gov/pacific/sites/default/files/Income6.pdf 

You have to have TAXABLE INCOME from Colorado

MarilynG1
Employee Tax Expert

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

@j0707 If you have Rental Property in Colorado, you should always file a Colorado State Return, even if your 'bottom line' Schedule E shows a loss.

 

If you collected rent and paid Property Tax there, you should file a Colorado Return. 

 

Your suspended Passive Activity Losses are reported on your Federal Return on Schedule E.

 

If you sell a rental property with suspended PALs, you may be able to deduct them on top of deducting any Section 1231 loss from the sale. Like Section 1231 losses, deductible PALs can offset other income and also create or increase an NOL that you can carry backward or forward.

 

Click this link for more info on Suspended Rental Loss.

 

 

 

 

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1285
Returning Member

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

Your losses still can be carry and they will. Show me where(on a government site - Colorado state or IRS said that you have to file taxes, if you do NOT HAVE A TAXABLE INCOME).

I upload a page from  State State of Colorado where it's said that you HAVE TO HAVE A taxable income. Loss from rental property is NOT A TAXABLE INCOME.

It's on the form, which I upload- Who is Colorado NON Resident. I am Enrolled Agent and I am pretty familiar with the tax regulations. I may be wrong, but show me anywhere where it's said that you have to file a state tax return if you do not have any taxable income.....I just show you that the State of Colorado is saying that needs to be a Taxable Income and Loss from Rental Property is NOT.

Irene2805
Expert Alumni

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

You should file a CO nonresident return.  The Colorado Individual Income Tax Filing Guide (p.3) states:

 

Generally, you must file this return if you are required to file a federal income tax return with the IRS for this year or will have a Colorado income tax liability for this year and you are:

• A full-year resident of Colorado, or

• A part-year Colorado resident who received taxable income while residing here (you must file the DR 0104 along with the DR 0104PN), or

• Not a resident of Colorado, but received income from sources within Colorado (you must file the DR 0104 along with the DR 0104PN). 

The instructions refer to "income."  Rental receipts are considered income.

 

@1285

1285
Returning Member

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

ok, you may be right, but why it's said Taxable Income on multiple Colorado State pages

Check this link as well:https://tax.colorado.gov/part-year-and-nonresident - it's said taxable income

https://www.colorado.gov/pacific/sites/default/files/Income6.pdf - it's said taxable income as well

 

1285
Returning Member

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

one more saying you do not have to file, unless is a taxable income

https://www.taxesforexpats.com/expat-tax-advice/statedocs/CO%20residency.pdf

Anyway I input the loss in the software for rental loss, and of course doesn't change anything.

I think you do not have to file it, it doesn't make any sense, I found 3 different sources from the State of Colorado, saying you do not have to file unless you have a taxable income.

 

maglib
Level 10

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

Taxable income is any income subject to tax at even 0 rate. So yes it is reportable. It is before expenses taxable income. 

maglib
Level 10

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

Taxable income is any income subject to tax at even 0 rate.  No iffereng then you file a tax based on gross income and can claim defuctions. So yes it is reportable. It is before expenses taxable income. 

maglib
Level 10

Should I file a non-resident Colorado tax return if I own property with passive lost? If I don’t file will this affect deduct suspended passive losses in the future?

Taxable income is any income subject to tax at even 0 rate.  Compare to gross income  reportable on a 1040 before deductions and exemptions. So yes it is reportable. It is before expenses taxable income. 

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