Moved from Ca to Wasington state

[Rvhunt]

I permanently arrived in WA on April 25th.  A few questions:

What deductions might be available?  This was a personal move and not job related.

I have rental income from property in CA.  Also, have income from interest, dividends and capital gains outside of CA.  What are my CA tax liabilities?

Will the turbo tax software help me navigate my state and federal taxes accordingly?

Thanks.

[KochuK]

Hi Rvhunt, thank you for joining the "Ask the Experts: Moving" special forum today.

Congrats on the move to WA state, a no income tax state.

For tax year 2021, you are part year CA resident and part year WA resident. You would need to report income earned in CA or sourced in CA on the part year CA resident return.

To answer your questions:

1. Unless you are military,  the moving expense deduction has been suspended for tax years 2018 through 2025 as a result of the Tax Cuts and Jobs Act that was signed into law in late December of 2017. In general, for personal move, there is no tax deductions.

2. Since the rental property is in CA, you would need to report the total rental activity in CA return. Interest and Dividend can be allocated by time in CA if earned evenly throughout the year. Capital gains can be determined by the sale dates - in CA or WA. Below is a great article.

How do I allocate (split) income for a part-year state return?

https://ttlc.intuit.com/community/income/help/how-do-i-allocate-split-income-for-a-part-year-state-r...

3. Yes, TurboTax is more than competent handling your move for income tax reporting. All income is reported in Federal tax return. Below article shows you how to properly enter data in Personal Info regarding your move, so the program calculates accurate CA filing.

How do I file a part-year state return?

https://ttlc.intuit.com/community/state-taxes/help/how-do-i-file-a-part-year-state-return/00/26057

Hope this helps.

[lconley2]

Dear RVHumt!

Thank you for trusting TurboTax with your tax questions. 

To answer your first question:  

The 2017 Tax Cuts and Jobs Act changed the rules for claiming the moving expense tax deduction. For most taxpayers, moving expenses are no longer deductible, meaning you can no longer claim this deduction on your federal return. This change is set to stay in place for tax years 2018-2025.

But if you need to amend a previous return prior to tax reform, or if you serve in the active military and meet certain circumstances, you may qualify for a deduction. If neither of these describe your situation, you may still want to track your expenses because some states continue to provide a deduction on your state tax return if you meet specific requirements.

Secondly, TurboTax software will definitely help you navigate your state and federal tax situation. You can even select a TurboTax Live product that will include assistance from a Tax Expert, should you have questions along the way! 

Finally, you will need to file and pay CA taxes as follows:

Part-year resident: If you lived inside or outside of California during the tax year, you may be a part-year resident. As a part-year resident, you pay tax on:

• All worldwide income received while a California resident
• Income from California sources while you were a nonresident

As a nonresident, you pay tax on your taxable income from California sources. Sourced income includes, but is not limited to:

• Services performed in California
• Rent from real property located in California
• The sale or transfer of real California property
• Income from a California business, trade or profession

I hope that helps! Thanks again for trusting TurboTax with your tax questions! Have a fun day! 

LloydC, Enrolled Agent