1256 Loss carryback - NY state taxes

[erlewine]

Anyone encounter a 1256 loss carryback in NY?

1) Is there any recourse to get state taxes back? NY has a NOL carryback but no mention of 1256

2) If it can't be done, say you eliminate a -100k schedule D loss on your federal, do you get to apply that against state taxes in future years now that your federal schedule D is zero'd out?

 

[Robert Morse]

I would talk to them. I always thought the state followed the IRS, but not my expertise. https://greentradertax.com/trader-tax-center/tax-treatment/section-1256-contracts/

Unlike securities, Section 1256 contracts have a nifty tax-loss carryback election. On Form 6781, select the “net section 1256 contracts loss election” in box D. Enter, but don’t deduct the loss on the current tax return. Remove the loss from Form 6781 on line 6. Apply the Section 1256 loss on amended tax return filings against Section 1256 gains only. It’s a three-year carryback, and unused amounts are then carried forward.

 

[erlewine]

Anyone encounter a 1256 loss carryback in NY?

1) Is there any recourse to get state taxes back? NY has a NOL carryback but no mention of 1256

2) If it can't be done, say you eliminate a -100k schedule D loss on your federal, do you get to apply that against state taxes in future years now that your federal schedule D is zero'd out?

Just to clarify there is no 1256 treatment in NY, you just enter capital gains from your federal (which is then taxed as ordinary income)

The real question is if I amend a 2015 federal return which has $100k capital gain and reduce it to zero as a result of a 2018 tax year loss, do I then go back and refile state taxes with the amended capital gain amount and AGI?