My husband and I lived in VA through November and he still lives there. I moved to NC end of November. We are married filing jointly. Income is from his job and investment income we share. I downloaded both VA and NC state returns. I cannot figure out how to indicate that I am the only one that moved to NC in 2021. I indicated he was a full-time VA resident and that I was not under the Federal return. Under VA, we are allowed to choose to file jointly so I did that. Under NC, TurboTax assumes that my husband either (1) made money in NC or (2) had more than one state of residence or (3) made money in NC but never lived there. I need TurboTax to know that he only lived in VA and did NOT make money in NC. Any suggestions?
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North Carolina requires you to use the same filing status that you used on your federal return unless the exception below applies. If you file the joint NC return, you are both treated as NC residents and all income is taxed, so using the exception is beneficial in most cases.
Couples who file a joint federal return and one spouse is a nonresident of North Carolina and had no North Carolina taxable income may file: (1) a joint North Carolina return or (2) the spouse with the North Carolina taxable income may file a separate North Carolina return. Taxpayers who choose to file a separate North Carolina return must attach a separate federal return or a schedule showing the computation of separate federal taxable income to the North Carolina return.
How do I prepare a joint federal return and separate state returns?
Thank you so much. I think this makes sense.
So, if I had no income other than capital gains from investments, and I lived in NC for the last month of the year, I'd just take 1/12 of my half of the cap gains as my income for NC? Apologies if this is getting too into the weeds and details.
Yes, that is correct. Your North Carolina income would be 1/12th of half of the capital gains.
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