I inherited a house out of state where they have state income taxes. I live in a state without state income taxes. I never lived in the house, I never rented it out, it generated no income. It was under $100,000. Federal taxes there was NO capital gain. It was sold below the appraisal and with costs of sale, it was not a gain. Do I still have to report the sale on that out of state income tax form? Even if it's not a gain and no income generated? It's an actual loss, in that it was sold below the appraisal at the time of death along with costs of sale. Living in a state that has no state income taxes, I just learned that the state the property was in, does have state income taxes and I need to know was I suppose to still file that state's income tax form, to report the sale. Even if it was no income, and no gain? According to federal income tax, it was no income and no gain. If I should have still reported it's sale on that states income tax form, as a non resident, should I file one now? Late? Or just wait until they contact me and then provide the info. Can they penalize me for not filing, even if nothing was due? Do they calculate the capital gain/loss the same as federal? Based on the appraisal at the time of death in relation to the sales price and expenses of sale?

Is there an Executor, an Estate Attorney?

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Originally Posted by ddfb

... I need to know was I suppose to still file that state's income tax form, to report the sale. even if it was no income, and no gain? According to federal income tax, it was no income and no gain. ...

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Did you report the sale on your federal tax return?

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Originally Posted by AK lawyer

Did you report the sale on your federal tax return?

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Yes of course I reported it on the federal, all the federal transferred over into the mass. State non resident tax form, but it generated all zeros, and only showed a capitol net loss on the last page, it showed no taxable income, no tax. Even on the mass source income it showed 0. the mass gov and revenue site says you have to file, even with no tax due if the Mass source income exceeds the prorated exemption. But then it says: who must file : non residents: you must file if your mass source income exceeds that personal exemption as stated, it describes "mass source income" as types of income that's taxable.. and then says "Income taxable" is a "gain" from sale of real property located in Mass. So since it's a loss from sale, that would mean I didn't even have to file it. I may just send it in to be safe.