NJ guru

Technical topics regarding tax preparation.
#1
zl28  
Posts:
2066
Joined:
22-Apr-2014 10:27pm
Location:
usa
Any NJ gurus out there.

Situation:

-have NC rental property for taxpayer that always makes inxs of 150k
-he sold the property in 2022 for 250k gain
-this gave him 250k in passive income
-which allowed the 100k passive loss carryover to be used on the federal and NC

Problem:

-for NJ i record the gain and get the credit for what was paid to North Carolina-
-NJ is as far as i know not allowing the 100k loss on the Schedule E
-Basically the depreciation through the years is 100k
-I'm getting no benefit on the depreciation
-Anyway i can take this passive loss?...
-if i can't, anyway to adjust the basis for NJ since i rec'd no tax benefit for the depreciation?

ty!!
 

#2
sjrcpa  
Posts:
6475
Joined:
23-Apr-2014 5:27pm
Location:
Maryland
Not a NJ guru, but NJ does not allow passive loss carryovers.
I've got a NJ nonresident return with a $500K gain on a property and a $300K PAL carryover allowable for federal and DC.

I'm not aware of a basis adjustment for NJ. If there is, I'm all ears.
 

#3
zl28  
Posts:
2066
Joined:
22-Apr-2014 10:27pm
Location:
usa
One of my peers said he had this situation 15 years ago and there was a case where the basis was increased
bc of no tax benefit to the depreciation taken bc the passive loss carryover predominantly stemmed from the dep...so he adjusted accordingly...I didnt' ask him the case; i don't htink he recalled, but he very specifically remember the siutation and doing the research and the outcome.
 


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