Claiming income on out of state properties

[Steve Kirsch]

hi BPers,

Here’s another tax question. 

Do I need to claim/file income tax in the state that I purchased an investment property in AND claim that same income (rent) for that property for the state of which I reside in? Or do I only need to pay for the property tax in state where the property is located? I don’t want to have yo pay twice. The investment property is not located in the state where I live. 

Thank you

[Luke Burnidge]

When buying out of state properties you will have to file a tax return in the state the property is located and pay taxes to that state. This income will also be included in your income for your resident state, however most states allow you to take a credit for taxes paid to non resident states. In many cases you will get to take a credit for the full amount paid to another state.