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Merlo, Accountant
Category: Tax
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Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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In New Jersey, can capital gains resulting from the sale of

Resolved Question:

In New Jersey, can capital gains resulting from the sale of real estate be offset against capital losses from stock losses?
Submitted: 8 years ago.
Category: Tax
Expert:  Merlo replied 8 years ago.
Hello Dr Rod,

NJ follows the same rules as allowed by the IRS. Capital gains from the sale of real estate can be used to offset capital losses from the sale of stocks or any other type of capital loss.

However, if the real estate which you sold was an investment property, then part of your gain from that sale would be the recapture on depreciation. That part of your gain is not treated as a capital gain, and is taxed at a special rate of 25%, and that part of the gain cannot be used to offset other capital losses.

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Thank you Dr. Rod.

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