Taxation of Nonresident’s Stock Sale Divides Massachusetts Panel

Three Massachusetts appellate justices appeared split at oral arguments Tuesday on whether the state has the right to tax capital gains realized by a company’s founder after he moved to New Hampshire.

Craig Welch wants the Massachusetts Appeals Court to reject a $300,000 Massachusetts income tax assessment on 100% of the capital gain he made selling stock in his risk management services company, AcadiaSoft Inc. Welch lived in Massachusetts from the time he co-founded the company in 2005 until shortly before the sale, leading the state to argue that the gain was connected to his work there.

Justice Marguerite T. ...