USA CA capital gains tax for non resident

[Sportsdad1960]

Hello!
We recently inherited, and sold a Lake Tahoe Property that my Aunt left in the trust. She bough it in 1958 and needless to say it sold for more than $2000 she paid for it.
We live in WA state
What sort of capital gains tax, if any, will we have to pay to California ? Property sold for $115,000.
Thank you so very much.

 

[Cherie CPA @firm1040]

For tax purposes and determining capital gains (losses), you need to know the fair market value of the property at the time of death, that is your new cost basis for determining capital gains (losses). You mentioned it sold for more than $2,000 than she paid for it. Hence I assume she paid $113,000 back in 1958. However, it's now 2017 and the value could easily be way more than that. For example purposes, if the property was worth $515,000 at the time of death and it sold for $115,000, you would have a LT capital loss of $400,000, and of that you can deduct $3,000 for as long as you have carry forward losses.

But if the fair market value was say $50,000 and you sold it for $115,000, you would have LT capital gains of $65,000 and pay the LT capital gains tax rate.

Hopefully this helped!

 

[Drmdcpa]

CA does not distinguish between capital gains from ordinary income.

With that said, if you sold the home shortly after death, and it was not in an irrevocable trust prior to death, chances are you actually have a loss on it. This is because basis equals FMV on date of death. If sold reasonably after that FMV did not change, but costs to get it sold particularly real estate commission will cause a loss.

Loss may be deductible since the property is investment when held by trust/estate even if it was principle residence to decedent.