Nevada Democrats Rock!
Never thought you’d hear that from us, now did ya?
Yes, we are happy with recent utterances by Nevada Congresspersons Berkley and Titus, as set forth in their letter to Madame Speaker Pelosi, noting that they strongly support extending the current tax rates on capital gains and dividends.
“Raising taxes on capital gains and dividends could discourage individuals and businesses from saving and investing. We urge you to maintain the current tax rate for both dividend and long-term capital gains taxes.”
And consider that a total of 47 Dems signed the letter, according to the Associated Press, and if they stick to their guns and side with Republicans, extension of the “Bush tax cuts” could actually become a reality for everybody – the “rich,” as well as folk of more modest means.
But don’t hold your breath…..
And California continues to have it both ways – as set forth in a recent decision by the California Board of Equalization in the Frazar matter.
Seems the taxpayers (married folk) moved from California to Montana in 2004, after having sold some stock on the installment basis, therefore subsequently receiving substantial installments when living in Montana. They thought the post-move installments weren’t taxable by California, and filed their returns accordingly.
The Franchise Tax Board disagreed, of course, and the taxpayers ultimately appealed to the BOE – and lost. Not surprisingly – for some time, tax authority in California has stood for the proposition that the source of the sale of intangible property (like stock) is established at the time of the sale, and it doesn’t matter if the taxpayer later moves away and actually collects some or all of the sales price.
And the galling aspect of all of this is that – yes – California has found a way to twist its rules in such a way that a new resident is also taxed on collections on his installment note, even though his sale occurred earlier, when he resided in some other state!
Back to the Frazar situation, the result may not be as bad as it seems – California and other states do allow folks to take a credit on one or the other state return so that the same income isn’t taxed by two jurisdictions.
CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He is also a contributor to the recently published 13th edition of Tax Savvy for Small Business, published by Nolo. He may be reached at 831-7288, and welcomes comments below.