Californians Lose Tax Office Bid to Reduce Gain on Home Sale

A California couple largely failed to convince a state tax tribunal that they’re entitled to a larger basis in the home they sold to reduce their taxable gain, according to an opinion posted Monday.

Fred R. Seddiqui and Kathy M. Seddiqui “have not provided invoices, receipts, credit card statements, bank statements, complete contracts, or other similar documentation showing expenditures in excess of $2,128,096,” the basis the state calculated, Administrative Law Judge Veronica I. Long wrote for California Office of Tax Appeals in an opinion marked pending precedential.

The three-judge panel sided with the Seddiquis on their argument that the Franchise ...