NY State income tax on timeshare sales

[janej]

Hi all,

I am selling my Lake Placid Club timeshare with some gain. The deed went to recording and sent back to the title company asking them to collect State Income tax on the gain. Has anyone gain through the process? Do I need to calculate the capital gain now or is this considered withhold? Do I need to file NY state tax return this year? Am I liable to pay income tax to NY outside of the capital gain on this sale?

Thanks a lot for your help,

Jane

 

[carl2591]

i would guess that a gain would be something not much seen with timeshare sales expect in rare cases..

you take how much you paid for the unit and subtract how much you sold the unit for and this is the gain. more than likely you have a negative "gain" .

 

[janej]

I do have a positive gain, not much, but still positive. I just have to make sure my other income is not subject to NY income tax because of this transaction.

 

[Larry]

I do have a positive gain, not much, but still positive. I just have to make sure my other income is not subject to NY income tax because of this transaction.

You only pay income tax in your state of residency. Since you don't live in NY State their should be no income tax withholding for NY and you don't need to file a NY State return.

 

[SOS8260456]

You may have to file a non resident NY tax return. I try to stay as far away from NY state tax returns as possible because NY seems to tax anything and everything. If you file taxes in your own state and your own state considers the same gain taxable, you may be able to credit on your own state's tax return for tax already paid to another state on the same income. However, if your tax rate is lower than NY state's, your state will usually only give you credit up to your state's tax rate.

You should check with the person who does your income tax returns or call New York's revenue department.

 

[janej]

I got more information from the broker. Looks like these are the two forms that need to be filled out

http://www.tax.ny.gov/pdf/current_forms/property/tp584_fill_in.pdf

http://www.tax.ny.gov/pdf/2011/inc/it2663i_1211.pdf

 

[arc918]

You only pay income tax in your state of residency. Since you don't live in NY State their should be no income tax withholding for NY and you don't need to file a NY State return.

Just one more reason to not get your tax advice on the internet...

Most states are worldwide income states, but other states can and will tax you on non-resident income in their state. You will then get a credit on any double taxed income. In all but 4 states, that credit is on the resident state side.

It all comes down to how much income you earned there. In New York, non-residents can earn $7,500 ($15K married filing joint) without having to pay tax.

 

[pacodemountainside]

Having lived in NY some 25+ years know they do go after non-residents acquiring money with in borders.. They nail those fats cats that live in Jersey and CT.

For example, if Broncos play a football game in NY the payers have to pay tax on their "income" for that game.

Follow Lisa's advice, Larry's will get you in deep stuff! However, given small amount doubt they will send any Mafia arm breakers after you!

Since you can can claim on Federal tax return as itemized tax deduction and probably claim as credit on your state return no big deal.

Congratulations, you are the first poster I have seen that made a "profit" selling time share!

 

[SOS8260456]

Having lived in NY some 25+ years know they do go after non-residents acquiring money with in borders.. They nail those fats cats that live in Jersey and CT.

For example, if Broncos play a football game in NY the payers have to pay tax on their "income" for that game.

Follow Lisa's advice, Larry's will get you in deep stuff! However, given small amount doubt they will send any Mafia arm breakers after you!

Since you can can claim on Federal tax return as itemized tax deduction and probably claim as credit on your state return no big deal.

Congratulations, you are the first poster I have seen that made a "profit" selling time share!

They have also done a good job coming after PA residents.

The OP must have definately purchased resale.

 

[janej]

Thanks all for the advice. I set down and read the Instructions for Form IT-2663 a few times. I now understand it is an estimate. What I am still very confused about is that which state I am actually liable for.

I purchased the timeshare on eBay. The gain is definitely under $7500 since the sell price is under $7500 and I paid about $2k. Will I get credit back from NY and then pay tax to VA? Or I will get credit from VA for what I paid to NY?

This is so confusing.

Thanks,

Jane

 

[rapmarks]

wow, congratulations on that big gain. very rare in today's market.

 

[SOS8260456]

Thanks all for the advice. I set down and read the Instructions for Form IT-2663 a few times. I now understand it is an estimate. What I am still very confused about is that which state I am actually liable for.

I purchased the timeshare on eBay. The gain is definitely under $7500 since the sell price is under $7500 and I paid about $2k. Will I get credit back from NY and then pay tax to VA? Or I will get credit from VA for what I paid to NY?

This is so confusing.

Thanks,

Jane

If your state has a reciprical agreement with NY state (meaning NY and VA have a pre-existing agreement to not tax the other state's residents on income from the other state) then NY would have to refund the money to you and you pay taxes to VA.

However, NY has refused to have a reciprical agreement with PA, so I find it very unlikely that they have one with VA. In that case, you file and pay the tax to NY and then you should be able to take a credit on your the VA tax return for the amount of tax paid to NY. Usually the credit is limited to your state's tax rate times the taxed income. So if you paid NY 8% tax on $5,000 and VA taxes you 4% on that same $5000, you can only take a credit for taxes paid of 4% on $5000.

Take this advice based on the cost of it. I am not 100% familiar with NY and VA tax laws. I know NY's to the extent of a PA resident working in NY and PA and VA have reciprical agreements so VA is not allowed to tax PA resident's income.

 

[DeniseM]

Be aware that collecting bogus taxes on a timeshare sale is a common scam. They collect the tax upfront and never pay you off. IF this is Legit, they will take the taxes out of the proceeds. NEVER pay any fees upfront!

 

[RLG]

You only pay income tax in your state of residency. Since you don't live in NY State their should be no income tax withholding for NY and you don't need to file a NY State return.

I'm always amazed at the people on various boards (not just TUG) who rush to post about matters about which they appear to know nothing.

"Better to remain silent and be thought a fool than to speak out and remove all doubt."
Abraham Lincoln