I live in MD, but sold 3 farm parcels in VA. TurboTax includes the Capital Gain for these sales in my Maryland return. Should VA property sales be taxed in MD? How do I fix this????? H E L P
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A nonresident pays state income tax on state source income (which includes selling property in a state) and a resident pays tax on all income, regardless of source. To avoid double tax, a resident taxpayer is entitled to claim a credit for income tax paid to another state if the income is subject to tax in both Maryland and another jurisdiction. In TurboTax, look for the Credit for Taxes Paid to Another State (see below) and go through that section to get your credit.
Thank you for the quick response. Not the answer I was HOPING for, but I believe it is the correct response.
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