HELP! Any NC preparers that can answer a question?

[gfizer]

Had a fella call today.  He was a part-year resident of NC and a part-year resident of KY.  Moved to KY and got married in July.  He and his wife are filing married filing separately and she is itemizing deductions.  Wife has never lived in NC and has no NC income.  My question is this - can husband use the NC standard deduction since the wife was never a NC resident?  The data form on ATX says "check this box if filing status is married filing separately and spouse is itemizing on NC."  My gal is not itemizing on NC because she's not required to file anything for NC.  Thanks in advance.  You guys are the best!

[JohnH]

Here's a link to the explanation.  

http://www.dornc.com/taxes/individual/resident.html

[JohnH]

And here's another explanation (more to your point, I think).  Looks to me like he cannot claim the standard deduction on the MFS return.  But that's just from a quick read...

http://www.dor.state.nc.us/taxes/individual/standard.html

[gfizer]

 

44 minutes ago, JohnH said:

And here's another explanation (more to your point, I think).  Looks to me like he cannot claim the standard deduction on the MFS return.  But that's just from a quick read...

http://www.dor.state.nc.us/taxes/individual/standard.html

Thanks, John.  I appreciate the help and I agree.

[Terry D EA]

I'm not sure I agree. The paragraph doesn't mention whether the spouse itemized deductions were for federal or NC. Just sayin.

If you are entitled to and claim the standard deduction on your federal income tax return, you MUST claim the N.C. standard deduction on your State return. If you itemized your deductions on your federal return, you may claim either the N.C. itemized deductions OR the N.C. standard deduction on your State return unless you are not entitled to the N.C. standard deduction. The N.C. itemized deductions are not identical to federal itemized deductions and are subject to certain limitations. If you are (1) married filing a separate return for North Carolina income tax purposes and your spouse itemizes deductions, (2) a nonresident alien, or (3) filing a short-year return because of a change in your accounting period, you are not entitled to the standard deduction. . Note 1: A Nonresident alien who is a student or business apprentice and a resident of India is entitled to a standard deduction. Note 2: A short-year return does not relate to a taxpayer who files a return as a part-year resident. The N.C. itemized deductions are not identical to federal itemized deductions and are subject to certain limitations. Note 3: A short-year return does not relate to a taxpayer who files a return as a part-year resident.

[JohnH]

H-m-m.  Interesting point there, Terry.  You have me rethinking this as well.  Could NC make it any more confusing?

[Terry D EA]

That seems to be the way with NC. You call them and they won't know either.