ST in CA

[JG EA]

ST, Or anyone in CA,

I have a question about a sale of CA property (land and timber in one sale) that was not a business, just a personal holding. A non-resident sold the property and has a pretty low basis unfortunately.

1. Is there any CA capital gains break? The withholding was not nearly sufficient which surprised me because the other sales I've seen from CA the withholding was way too much.

2. If I have the withholding amount and the name, address, phone number of the withholder (the title company) is that sufficient for the form? Do I need to make inquiries about their EIN # for instance.

Thanks in advance!

[JG EA]

To the board from a "senior member"

I really like TTB. I've had time to look through it and today used it to look up information for a client. The first few pages are awesome. I can't remember having all those next years' numbers now!

I was impressed by so much that I saw. It does seem clearer than the "others" - that's needed when you look something up quickly - and that's what the book is all about. I really like all the references.

I also liked all the addresses - today I was trying to double check with the IRS website if they are all the same and there they were in the book - easy to find.

TY JG

[jainen]

unfortunate

I'm not sure why it's unfortunate that your client made a lot of money on the investment, but anyway California does not have a different rate for capital gains tax. Real estate withholding is always 3.33% of the gross sale price. That's too much if you only have a small gain, but not enough if most of the proceeds represent gain taxed at the top bracket of 9.3%. Report the withholding in the ordinary way. Don't forget the credit for income taxed in two states.

[JG EA]

Thanks for the info.

I'm not sure why it's unfortunate. ..

It's only unfortunate because I thought there was going to be a step-up in basis, but found out the land was gifted.

Thanks for the information, I didn't know the percentage they withheld. Now I know there is no capital gains break.

Do you know about the withholding form? Can I just fill out the info I have from the closing papers? Will that be enough info?

Thank you,
JG

[jainen]

amount withheld

Assuming the escrow company has the curent address, the taxpayer will receive a copy of Form 593-B to attach to the California tax return showing the amount withheld.

[Unregistered]

Assuming the escrow company has the curent address, the taxpayer will receive a copy of Form 593-B to attach to the California tax return showing the amount withheld.

Many companies are including the 593-B with the final closing statement now. I've had clients bring them in so they won't loose them.