Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

I am a non resident of North Carolina and sold property in

Customer Question
2006 but deferred the gain...
I am a non resident of North Carolina and sold property in 2006 but deferred the gain by doing a 1031 exchange through a qualified company. I filed the 8824 like kind exchange form for federal and in my resident state. As I had no income I did not file a non resident return. Was this correct to not file a return in North Carolina. Their filing requirement states you need to file if you had any type of income, however, the gain was deferred because of the 1031 exchange. I received a notice from the state that I should have filed a non resident return due to the sale and they assumed I had income from the sale which I did not.
Submitted: 7 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 1 hour by:
6/17/2010
Tax Professional: Lev, Tax Advisor replied 7 years ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,656
Experience: Taxes, Immigration, Labor Relations
Verified

According to NC instructions - http://www.dornc.com/downloads/D401.pdf

Who is required to file a North Carolina individual income tax return?

Every nonresident who received income for the taxable year from North Carolina sources that was attributable to the ownership of any interest in real or tangible personal property in North Carolina or derived from a business, trade, profession, or occupation carried on in North Carolina, or is derived from gambling activities in North Carolina
and whose total income from all sources both inside and outside of North Carolina equals or exceeds the amount for his filing status shown in Chart A or B below.

 

See threshold amounts on the page 4.

Please note that filing requirements are based on the total income - not taxable income, and not income reduced by any deductions or by the amount which was deferred for federal income tax purposes.

 

Please also take in consideration that NC DOR received an information about the sale price, but has no any information about the basis and will consider the total proceeds as your taxable income unless you file a tax return.

 

Thus:

-- you most likely are required to file a tax return (assuming the sale price is above the threshold)

-- by filing the tax return - you will inform the NC DOR that you do not have any tax liability

-- if you do not file a tax return - the statute of limitation will not applied, but if you do file the tax return - NC DOR has generally only three years to assess any additional taxes.

 

Let me know if you need any help.

 

Ask Your Own Tax Question
Customer reply replied 7 years ago

There was no gross income as the property sold was exchanged for two like kind real properties thus deferring the gain. On the federal return form 8824 was filed showing the deferred gain but does not show anywhere on form 1040. Based on the fact that no gross income was received but deferred because of the exchange that is why I did not file a return. Also, would there be a penalty for not filing? Since there was no gross income, I do not believe I am liable for any state income taxes as the gain was deferred.

Is that correct?

Tax Professional: Lev, Tax Advisor replied 7 years ago

The sale price would be your gross income. That amount is reported on the 1099 form.

the fact of deferring the gain - doesn't eliminate filing requirements.

If you have no NC taxable income - that should be stated on your NC tax return and your federal tax return (including the form 8824) should be attached.

 

I understand your reasoning, however please also understand that NC DOR doesn't have the information you provided above.

They only have the amount gross sale reported on the form 1099. They do not know your capital gain and have no information that the capital gain was deferred.

The simplest and formal way to provide that information to NC DOR - is to file a tax return.

 

There will not be any penalty - because penalty is based on the amount of tax you owe. Assuming - you do not owe any NC taxes - there will not be any penalty.

 

Let me know if you need any help.

 

 

Ask Your Own Tax Question
Ask Lev Your Own Question
Lev
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,656
30,656 Satisfied Customers
Experience: Taxes, Immigration, Labor Relations

Lev is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,338 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,980 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Do I have to pay federal income tax on Monet received from
Do I have to pay federal income tax on Monet received from insurance due to hurricane damage to my home? … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,980 satisfied customers
On a NJ W-3 form, is line 3 the NJ Gross income tax withheld
On a NJ W-3 form, is line 3 the NJ Gross income tax withheld or is that supposed to include unemployment tax, FLI, SDI, etc... as well… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,980 satisfied customers
Looking for the statute of limitation on the collection of
looking for the statute of limitation on the collection of WI taxes. in particular for withholding taxes from 21 years ago … read more
Lev
Lev
Tax Advisor
30,656 satisfied customers
Under the new tax plan if my federal adjusted gross income
Under the new tax plan if my federal adjusted gross income is $77,230.00 how much are my federal taxes? … read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,791 satisfied customers
On line 37 my 2015 Form 1040 I had an adjusted gross income
On line 37 my 2015 Form 1040 I had an adjusted gross income of $291,546. on my Amended 1040X for 2015 I have taxable income of $179,542. How do I get proof of this to get an adjusted MAGI to give to M… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,791 satisfied customers
My gross income is $17,105.64. Do I have to file a tax
My gross income is $17,105.64. Do I have to file a tax return? … read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,791 satisfied customers
Wanted to know if there was statute of limitations on ga
Wanted to know if there was statute of limitations on ga back taxes … read more
Chad EA, CFP ®
Chad EA, CFP ®
IRS Enrolled Agent, CFP(R),
Master\u0027s Degree
1,068 satisfied customers
Personal Estimated Federal Tax/Illinois payment: My federal
Personal Estimated Federal Tax/Illinois payment:My federal and IL taxes deducted on regular basis from pay check as employee. But I have S corp for which I know rough profit at 4th quarter since my ve… read more
Chad EA, CFP ®
Chad EA, CFP ®
IRS Enrolled Agent, CFP(R),
Master\u0027s Degree
1,068 satisfied customers
Regarding Federal tax income Form 4952, should I expect my
Regarding Federal tax income Form 4952, should I expect my client to provide me a form to help me fill out line 1 for "investment interest expense paid"? And if so what is the form number?… read more
Tax.appeal.168
Tax.appeal.168
Principal
13 satisfied customers
Where can I get the Federal income tax regulation? Where can
Where can I get the Federal income tax regulation? … read more
Lev
Lev
Tax Advisor
30,656 satisfied customers
Two questions on federal tax deductibility: 1. We personally
Two questions on federal tax deductibility: 1. We personally paid legal fees for our manufacturer C Corp. The fees were for assistance in preparing a Research & Development tax credit application. Can… read more
Lane
Lane
JD, MBA, CFP, CRPS
Doctoral Degree
37 satisfied customers
I asked for an Federal Income Tax extension to 10/16/17 and
I asked for an Federal Income Tax extension to 10/16/17 and I paid taxes due. This was for 2016. Am I able to extend it further?… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,277 satisfied customers
I'm going my federal income taxes. I have a small business.
I'm going my federal income taxes. I have a small business. I have 1099s from some of the companies that paid me, and the rest were individuals, various amounts. I listed all the 1099s separately in T… read more
Tax.appeal.168
Tax.appeal.168
Principal
13 satisfied customers
I recently filed amended federal tax returns (1040x) for
I recently filed amended federal tax returns (1040x) for 2013 and 2014. I have received a refund for 2014 and am answering some additional questions for 2013. Do I need to file amended tax returns for… read more
Lane
Lane
JD, MBA, CFP, CRPS
Doctoral Degree
37 satisfied customers
We have a NOL carryover on our federal income taxes. While I
We have a NOL carryover on our federal income taxes. While I was working on our taxes this week, I noticed an error was made in 2013, 2014 and 2015 in the calculation of the NOL carryover. I neglected… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2 FROM HER EMPLOYER WITH A TYPO IN THE SOCIAL SECURITY NUMBER. TO DATE THE EMPLOYER HAS NOT PROVIDED A "CORRECTED" FORM W-2. IS THERE AN IRS "… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,277 satisfied customers
Is a 1040 US Individual Income Tax Return federal income
Hi Is a 1040 US Individual Income Tax Return federal income taxes owed to the US government? Or is it FICA? I received a letter owing some back taxes and since I'm a priest with a weird set of tax exc… read more
ABC Accounting Group
ABC Accounting Group
Bachelor\u0027s Degree
686 satisfied customers
Form 1040 line #44 what taxes--federal income tax + social
form 1040 line #44 what taxes--federal income tax + social security +medicare tax, all or just federal? … read more
Lev
Lev
Tax Advisor
30,656 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x