New York capital gains tax: Long Island sale and filing guide
New York residents pay state income tax on all income; nonresidents pay on New York-source income, including income from New York real property. Selling Long Island property after moving out of state can still require a New York return.
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New York residence and Long Island property gains
New York residents pay state income tax on all income; nonresidents pay on New York-source income, including income from New York real property. Selling Long Island property after moving out of state can still require a New York return.
Nassau and Suffolk County residence is not New York City residence. Working in the city does not by itself make a Long Island resident liable for New York City resident income tax. Confirm any actual move or dual-residence facts.
- Check the state’s actual treatment
- Identify the seller, income type and residence before choosing a return or assuming an exemption. Read the state guidance
Nonresident sellers: check estimated tax before closing
The 2026 IT-2663 instructions cover certain nonresident transfers of New York real property. The process can require estimated income tax at transfer; exemptions require their own review. Later reconcile that payment on the applicable New York return.
A cooperative-unit sale uses a different form, IT-2664. Do not use IT-2663 for every kind of home. Keep transfer-tax paperwork separate from income-tax calculations and confirm the form matches the transaction year.
- Review the separate filing or transaction route
- Bring the sale agreement and ownership details to the preparer or closing professional. Open the official guidance
Home sales and inherited property need different records
A federal main-home exclusion has ownership, use and other conditions. Receiving Form 1099-S can require reporting even when the gain is excludable. Selling a rental, second home or inherited home is not automatically the same transaction.
For inherited property, keep estate valuations and ownership evidence. Receiving an inheritance and selling it later are separate events; the original owner’s purchase price is not automatically your basis.
- Check the federal home-sale rules
- Ask whether the exclusion and sale-reporting requirements both apply. Read IRS home-sale guidance
What to bring to a tax preparer
- Purchase and sale dates, gross proceeds, selling expenses and adjusted-basis support.
- Brokerage forms, closing statements, improvement records and estate valuations where relevant.
- Move dates, earlier federal/state schedules, loss carryovers and any tax paid at closing.
- Reconcile gain rather than taxing proceeds
- Use the IRS basis and capital-gain reporting guidance alongside the state instructions. Read federal capital-gain guidance
- Check payments during the sale year
- An investment gain can require estimated payments even without wage withholding. Review federal estimated-tax requirements
For the separate state income-tax calculation and filing route, use the New York income tax: rates and Long Island filing questions.
Ask a professional about your situation
Ask whether the practice handles this tax, transaction, location and year. Agree in writing who checks the records, prepares each return and handles any notice. General listings do not verify specialist expertise or eligibility.
Compare professional qualifications and questions to ask. Keep personal tax documents private; this directory does not receive returns, identity documents or portal credentials.
Related guides
- New York estate and inheritance tax: Long Island filing and executor records
- New York retirement income tax: Long Island pensions and Social Security
- Long Island property tax: Nassau assessments, Suffolk towns and payment resources
- Small-business accounting on Long Island: books, sales tax and local records
- New York income tax: rates and Long Island filing questions
Official sources and applicability
- New York filing and residency FAQs — Residents taxed on all income; nonresidents on New York sources including New York realty; NYC resident tax distinction.
Official guidance reviewed October 24, 2026; check the applicable year and transaction. Checked 2026-10-24. - New York 2026 IT-2663 instructions — Certain nonresident real-property sales need estimated tax at transfer; exemptions and later return reconciliation; co-ops use a different form.
Form IT-2663-I for transfers after December 31, 2025 and before January 1, 2027. Checked 2026-10-24. - New York estimated-tax forms — IT-2105 individual estimates and separate IT-2663 real-property/IT-2664 co-op nonresident sale forms.
Official guidance reviewed October 24, 2026; check the applicable year and transaction. Checked 2026-10-24. - IRS Topic 409: capital gains and losses — Adjusted basis versus proceeds, holding periods, personal-use losses and federal sale reporting.
Official guidance reviewed October 24, 2026; check the applicable year and transaction. Checked 2026-10-24. - IRS Topic 701: sale of your home — Conditional home-sale exclusion and Form 1099-S reporting even when the gain is excludable.
Official guidance reviewed October 24, 2026; check the applicable year and transaction. Checked 2026-10-24. - IRS estimated taxes — Capital gains can require estimated payments; withholding and payment timing require a separate check.
Official guidance reviewed October 24, 2026; check the applicable year and transaction. Checked 2026-10-24.
Next source review due 2026-11-23, and before promotion for a new tax year. To report an outdated resource, contact the directory without sending personal tax information.