He is 79 years old and moving to New York; we have understood the federal tax implications and how to calculate it, just not sure what the percentage for state capital gains would be - how could we find out?
I’m assuming he is expecting a gain of more than $250,000 because any gain up to that amount is excluded from federal and state tax. Income above that amount, capital gain or other, will be taxed at the marginal tax rate in California.
There is no preferential capital gains rate in California so the gain will be taxed at California’s regular rate. Since it was his primary residence he will be entitled to a 250K exclusion on the gain but any amount over that exclusion will be taxed at California’s regular tax rate.
The top tax rate in CA is 12.30% and it starts once income is over 562K. The lower rates range from 9.30%-11.30%.
If you want to avoid paying federal and state capital gains tax you may want to consider renting his house out and then having him will it to his children. This way when his children inherit the property it will receive a stepped up basis and result in little to no capital gains if the property is sold shortly after inheritance.
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