CANADA (alberta)....what are capital gains, like say I want to flip a house without paying?

Question

capital gains, how long do I have to hold onto the property...any sites would be useful too.

Answer 1

If it is your Principal Residence, you can flip it in a day. If it is not your Principal Residence, make it so before flipping it. The form you fill out to designate a property as your Principal Residence can be found at http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/reporting-income/lines101-170/127/residence/disposing/T2091-e.html

Section 54 of the Income Tax Act indicates that if you own the house during any part of the year (i.e. September 8th you bought it, then sold it September 12th) and it is designated as your principal residence, you do not have to report a capital gain.

"For a property to be a taxpayer's principal residence for a particular year, he or she must designate it as such for the year and no other property may have been so designated by the taxpayer for the year. Furthermore, no other property may have been designated as the principal residence of any member of the taxpayer's family unit for the year."

Seems cut and dry, that you can only have one Principal Residence, but then "While only one property may be designated as a taxpayer's principal residence for a particular taxation year (see ¶ 6), the principal residence exemption rules recognize that the taxpayer can have two residences in the same year, i.e., where one residence is sold and another acquired in the same year. The effect of the "one plus" in variable B (the numerator of the fraction) in the formula in ¶ 8 is to treat both properties as a principal residence in such a year, even though only one of them may be designated as such for that year." (this is all from http://www.cra-arc.gc.ca/E/pub/tp/it120r6/it120r6-e.html)

More information on disposing of your Principal Residence is available at http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/reporting-income/lines101-170/127/residence/disposing/menu-e.html

I hope this helps.

Answer 2

Hey girl, the Government doesn't want you to make easy money, so you'll have to live in the house for 1 year then sell to avoid the gains penalty. I believe its the same in Alberta.

Answer 3

the abode you inherited receives a foundation affixed to it on the date of lack of existence or in certain circumstances a date 6 months after would properly be utilized. So if the abode become initially offered for $50,000 and become properly worth $three hundred,000 on the date of lack of existence, some thing you promote it for above $three hundred,000 minus any prices, might want to be taxed contained in the fast time period. Now in case you pick to stay there for 2 years, then you surely might want to exclude as a lot as $250,000 income as a unmarried man or woman or $500,000 if married. you want to benefit out what the cost become on the Date of lack of existence, that could be contained in the sources tax go back if filed.