Mark, what if I put my investments into joint ownership with my daughter and son, but I report the income for tax. Does that get me out of the tax problems and work for probate?

Anon, The CRA has stated that where there is only a change in legal title and not a change in beneficial ownership the true owner there would most likely not be a deemed capital gain, however, the CRA is of the view that a true joint tenancy does not exist and thus the objective of reducing probate fees has not been achieved.

In plain language, reporting the income earned on assets transferred would be indicative subject to actual legal agreements that there has not been a true beneficial transfer and thus, the assets would still be subject to probate.

It's funny that the Star article refers to the couple "thinking with their heart instead of their head" but my immediate cynical impulse is to think that they were trying to avoid probate taxes and were bitten on the ass by not doing it properly, there was nothing well-intentioned about it.

I think you are partially right. Most intra family transfers have a twofold agenda. So I am not as cynical, but there definitely was a probate savings component, but what a costly mistake. Hello Mark, First off, I really like your blog; it's informative and well written. I was a little confused in this post where you write: The answer is that in all cases other than gifts, bequests and inheritances, the transferees cost is the amount they actually paid for the property and there is no adjustment to FMV, a very punitive result.

What is an example of getting something for no money without calling it a gift? Bequests and inheritances tpically arise from legal docs. What I am getting at is that often someone requires some sort of payment, even as a token and that is where the double tax issue arises. In respect of your question, the difference between a gift vs getting something for no money would just be intention.

However, they would often be one in the same, so I was a bit confusing. To show the intention, I would ensure a deed of gift drawn up by a lawyer. Hi Mark, Here's another scenario on the Principal Residence exemption: My parents and I owned a farm jointly.

I occupied the house as my principal residence and handled the expenses for it, while my parents continued to live in their own home or principal residence. We shared income and expenses of the land. I would like to help, but working in TO I have no experience with farms and i know they have some funky rules. You need to engage and accountant on this, it is very complicated even without the farm issue.

Hi Mark, I have a cottage that I want to gift to my son but I have been told that it could hurt him down the road if he sells the property because his cost base would be zero even if I claim the capital gain when the transfer is completed. One, is this accurate? Secondly, I have enough cash that I could "gift" my son today and he could then purchase the property at fair market value.

Would this be an acceptable transaction? I do not provide specific income tax planning on the blog. However, I would suggest the advice you have been given in not correct if the transaction is properly executed and documented.

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Speak to your accountant or lawyer to ensure the facts provide for a tax free gift and ensure you have a deed of gift or whatever the lawyer suggests drawn up.

Hi Mark and James - this is another Jim, Cottages must be a clasic situation for transition tax implications and FMV. My situation is Uncle gifting cottage to nephews. Not sure if this is different from a parent anything to know there. It seems that if a legal document such as a "deed of gift" shows the gifting intent then there would be a FMV transition. I assume the FMV would impact both giver and receiver s. The receivers would be subject to future cap gains if they had their own PR - they would have to pick one for the overlapping ownership timeframe upon an eventual sale.

HOw am I doing so far? However it would clearly be in the best interest of the receivers to establish a FMV as high as could be found in the market. How the heck does the FMV get established and documented? Cottages not in density cottage land are interesting. Hopefully you can validate some of the assumptions above and point me to something for a little focus on the FMV transition.

We are not doing it just to avoid probate. We are doing it before people go crazy and this cottage transition gets difficult. Hello Mark, I have a client who currently lives in a home that his parents bought.

Would there still be a FMV disposition, and impact on the parents to pay capital gains or not because the intent was for this property to help their children out? Not too clear on this Your guidance is much appreciated Hi Anon I do not provide specific income tax advice on this blog for obvious reasons. That being said, here are my general comments regarding situations of this type. The intent to "help" children is irrelevant.

Transfers of property are deemed sold at the FMV, nothwithstanding a sale price at a lessor value. Hi Mark I currently own my own principal residence and my parents are going to gift me a property a part of their principal residence that they will subdivide for me to build a new house on. Do i need to sell my principal residence first before accepting the gift property and building my new principal residence?

Hi Anon This is way to complicated a question to answer on a blog, you should speak to your accountant or your parents accountant. There is nothing stopping you from keeping your original PR however, you will need someone to explain the PR election and plus one rule and possibly the change in use rules to you and how they may apply to your situation.

If I sell the property FMV and provide a spousal loan for any shortfalls is this considered an event significant enought to be treated as a deemed disposition where my spouse could recognize all cap gains and income solely in her name going forward? Really enjoy your blog. Sorry, I should note on the above that this is being done primarily for income tax splitting purposes.

My wife is a stay at home mom and would be managing the property for income. Hi Anon I do not provide specific tax planning advice on this blog for obvious reasons. As your plan is somewhat complicated you should obtain income tax advice from an accountant. I will however suggest you consider the following issues. You will be deemed to have transferred the property to your wife at your ACB unless you elect out of the automatic spousal rollover. To elect out you must file an election with your tax return.

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Also you need to be cognizant of any recapture you may trigger upon transfer to your wife. My wife and I are currently living in a condo in Toronto. We are thinking about buying a house for us to move into. My parents are thinking about selling their house and buying our condo to move into. I'm thinking of the best way to minimize the transactional costs. Could my parents give me money in the amount that is FMV of the condo and my wife and I would still keep the condo under our names while my parents live in the condo?

This would avoid paying land transfer taxes and closing costs, and the condo would get transferred back to me when they pass away anyways. What are your thoughts on this plan? I do not provide personal tax planning advice on this blog.

However, what i dont like about your plan is your parents no longer have a tax free Principal residence and you only have one tax free property and one taxable. Hi Mark, bit of a complicated situation; Would you know how capital gains are treated if you receive a cash insurance settlement due to a fire on a rental property total loss, home demo'd As you have not technically disposed of the property, would all or a portion of a gain be triggered now for Rev Can?

Hey Anon Sorry, way to complicated to answer on a blog. However, check out this link for some info on replacement property rules. Back in 06', I transferred my half of our principle residence to my wife. I had NO tax problems at the time, but I ended up with tax problems afterwards and had to declare bankruptcy in August She sold that house in Can you tell me if she is on the hook for anything?

I do not provide personal tax advice on this blog, especially in fact specific cases such as this. Section of the Act may cause your spouse to be responsible for your liability in certain situations, however, you need to review the criteria. The key for you is whether you were liable to pay tax under the Act at the time of the property transfer even if assessed after the transfer. I attach an article about the topic here http: I think that was meant for me, thank you very much, Mark.

He lives there and runs her biz from there. We live in our principal residence. He has not been able to make payments. What tax consequences are we looking at?

Hi Anon I don't provide specific personal advice on this blog just some direction In this case since there is family I would engage an accountant to sort out the issues for tax and provide some practical alternatives that may keep everyone happy. I have a home that has been mortgaged since and my sister has lived in it and paid the mortgage payment throughout the loan.

She had bad credit so I helped in this way. According to what I understand, I am liable to pay the taxes even though I receive nothing in profit? Hi Anon I am missing facts and I do not provide personal tax planning advice.

However, in general if a home is in your name, even if done for credit or other purposes, a transfer would typically result in a gain equal to the Fair market value upon transfer less your original cost. It may be unfair, but you can only own one principal residence.

Merely being on the title of real property does not make you the 'actual' or beneficial owner under the law. The principal residence exemption belongs to the beneficial owner of the real property not the named entity on title. Usually it's both but not always. Generally speaking, if your sister is the common law beneficial owner of the home in question and it is her principal residence and you were brought on title, merely to satisfy a mortgage lender, she is entitled to the principal residence exemption and you are not liable for any capital gain.

This article provides some insight: From January 26, at Hi mark Just came across your blog and hoping you are able to point me in the right direction. We are selling our primary residence to buy a house with an inlaw suite with our parents. Can we apply for a joint mortgage or can only one party hold the mortgage.

If only one can hold it then it will most likely be our parents as they currently do not own a home or mortgage. It is our intention to pay them back for their purchase of the property or take over the mortgage for them.

Can we do this without incurring tax implications. We are planning to visit an accountant but would appreciate any input you may have.

I dont provide personal tax planning or mortgage advice on this blog. Your accountant should be ale to assist you. The mortgage is probably a red herring for tax, but I dont know all the facts, so discuss with your accountant. Hi Anon Legally and for tax purposes your own the house, however, for family law purposes he may have a claim as family property.

You would have to ask a family law lawyer, that is not my area. I have a rental property, when I bought it only my name on the deed but my husband do all the maintenance work and I almost do nothing. For the rent income can I put onto his income? Hi Anon In general only the legal owner can report the income. However, if it was your husbands money, you may be able to do something. Speak to an accountant. We kind of get all the money from bank and line of credit of our house. But the mortgage is on my name.

Just wondering how I should do it. Or need rollover the property? I don't provide personal tax advice on this blog. Engage an accountant to advise. Based on the facts presented you may be able to at least split the rental, but u need advice. Hi Mark, I just sold my principal residence my only property and lives with my son in his principal property his only property.

I plan to use the proceed from the sale of my house to pay off his mortgage. What will be the tax implication in this transaction, if any?

Hi David Sorry, but I do not provide specific personal tax planning advice on this blog. FYI, you will want to check the land transfer tax in your province on the gift to understand if it is applicable or not.

My sister-in-law and her husband would like to purchase a second home to allow her daughter's family to live there. Rent would possibly be a little less than FMV, being enough to cover the mortgage payment. The home being purchased is a foreclosure, hence being purchased at less than FMV. The idea would be for the daughter and her family to live there for 3 years and then purchase the house at the amount left on the mortgage at that point in time.

Of course, it would be a on-paper gifting to satisfy the difference between the mortgage balance and selling price. Would this make it an arms length transaction and satisfy the related party rules? I realize the parents would have to realize a capital gain for the difference between original cost basis and FMV at time of sale, and additionally have 3 years of depreciation recapture at ordinary gain.

Do you have any thoughts or a better suggestion? Hi Mary, Unfortunately I do not provide personal tax planning advice on this blog.

If your sister in law engages an accountant, they could probably sort this out in one consultation. You sort of have it, but I see other ways to go about this that an accountant could help u with. Hi Mark, Came across your very informative blog by pure accident and it has left me perplexed. In the late 70s my father bought a house and offered it as lodgings for 3 siblings and myself. It made sense to him that his 4 children contributed equally to mortgage while he worked towards retirement overseas.

Instead of paying rent to a landlord and having nothing to show for it, I must say it made sense to us too at the time. So legally we 4, were the owners of the house. My father retired and came to Canada and passed away a few years later. Before he did, he said that he wanted my youngest brother to inherit the house because he lived with and took of my parents.

What are the tax implications for the 4 of us? My brother has agreed to pay our capital gain taxes the 4 of us are charged. I have the oddest feeling we are in deep? Hi Anon I cant answer the questions because I would need to know if the siblings also had their own princiapl residences amongst other factors and I do not provide specific tax planning advice on this blog in any event.

I would suggest however, you may have an issue and you should engage an accountant and provide them all the facts and they can confirm whether you do indeed have an issue and provide you some alternatives if their is an issue. We recently bought a new home and intended to rent our first home a townhouse. After the re-financing of the townhouse was completed along with appraisals, etc our son asked if he could 'buy' it instead.

This 'buy' arrangement is such that I still have the mortgage on the property but he pays it, the property tax and all upkeep. On one hand, this is his principle residence and I am his 'mortgage company' while on the other it's a kind of rent-to-own arrangement except there's no benefit to me at all. How can I handle this from a tax perspective? Do I have to claim this as a rental? Hi Anon I do not provide personal tax planning and advice on this blog.

The situation is a little complex. The first issue is did you transfer the property to your son or is it still in your name? Don't answer, just saying issue.

You need to engage and accountant to help you through this so you create the most tax effective ownership and report what is required. Great content thank you. I'm trrying to make an important decision and would appreciate help. My daughter would like to get a condo. Should I buy this in her name and let her own this as her primary residence.

Which option would yield the most value. For example if she does buy she gets a rebate on welcome taxes as a firt time home buyer, can use her rrsp etc. If I buy it, she pays fair market vaue rent which is income, but I claim the interest, maintenance, taxes, heating, etc. I realize I then would need to claim capital gains at disposition. Would appreciate your thought as to which you think would yield the best value.

Hi Anon I don't provide specific income tax planning advice and to answer would require far too much work and way more info. All I will say is that if you are okay with the condo in her name she has legal ownershipif the price goes up, it is tax-free as her PR as opposed to taxable as your rental property. Thus, you need to make a best estimate of how much the condo will increase in value, the potential tax savings on that capital gain at your personal rate and compare it to the rebate savings.

The rental is much easier to deal with if it is owned by her and no income has to be reported. Hi Mark, My spouse and I sold our principal residence and currently rent our accomodations. We invested the proceeds from the sale of our residence. How are we taxed on the investment income? For example, do we each pay tax on half of the income, or do attribution rules apply that require us to split the income based on our percentage ownership of the residence?

Hi Anon Technically you report income based on the ownership of the residence, assuming the ownership reflected the funds contributed in the first place. Hi Mark, So glad I found this discussion! My brothers and I inherited property upon the death of my mother in Anyway, we are now thinking of selling the property and looking at two scenarios: Based on what you said above, there are some serious tax implications.

Can you dumb down both scenarios tax-wise for me please? Hi Writer, sorry but I don't provide personal tax planning on this blog. If one of you has an accountant I would see them for a quick consultation or if you don't, I would engage an accountant for a quick consult. You just need to understand what T's to cross and what I's to dot and who has to report what on their returns. Hi Mark, I recently resigned from a privately held family concrete construction company.

I am under the impression that my father is not happy about this and has informed me that the stocks being gifted was simply a way to slowly transfer ownership to my brother and I over time and only have value if the company was to be sold. The reason I ask this is because After 21 years of family service to the business, he agreed to pay me one months salary and offered Cobra to me after 30 days.

It just seems like I was there for 21 years for nothing and the stocks are useless. Am I correct in assuming that since I resigned, I am entitled to nothing, and just walk away?

Hi Anon This is way too fact specific and complicated a question for a blog. I suggest you speak to your accountant if you have one or engage one to explain the ramifications of your situation.

Hi Mark, Great blog!! My parents and I live together in the same house here in Ottawa. I will still live with them the house will remain my principal residence till the end of the year. I am planning to move out next year Thanks for answering in advance: I do not provide specific personal tax advice on this blog. However, in general, if someone sells or transfers a house that was their principal residence throughout their period of ownership, the transfer is generally tax free.

In respect of question 2, this will be a legal transfer and you will need legal documentation and there may or may not be land transfer fees depending upon your province. Hi Mark, I recently bought my first home and was thinking of renting it out for a year before moving in and living in it. I plan to live with my parents in this year that the house is being rented out.

Since it is my first and only home, I am hoping that it will qualify as my principal residence and be exempted from capital gains. Are there any tax implications that I should be worried about? If so, how should I go about to reduce these implications. In addition, if I were to rent out the basement after I move into the house in a year's time, will the house still qualify as my principal residence so that I will be exempted from capital gains?

Hi Anon See the blog I wrote for Jim Yih http: See my blog next week for the answer to your 2nd question. Hi Mark, This post has been incredibly helpful, thanks for keeping up with it.

I have a question for you. The value of the house is somewhere between K. The sale price would be so its easier from a LTT perspective.

When I tried to do that, the mortgage commitment that came back essentially wanted me to change all sale prices to instead of the we originally wanted. We are a bit stunned and clearly not happy. Are there any other ways I can get the house?

If my parents change the title to me, it would be my principal residence and from what I have read there would be no LTT and capital gains. How would I get a mortgage for ? Any advice would be greatly appreciated. I do not provide personal tax planning on this blog just general guidance.

That being said first of all have u checked with ur lawyer there is no LTT I think u have to meet love and affection criteria to be exempt. If for arguments sake the house is gifted to u again I am not saying that should or should not be done under the circumstances why could u then not get a mortgage when u have clear title with no debts attached?

Hello Mark, My wife and I own a condo in Hawaii. We would like to transfer ownership to our daughters family via allowable gifts each year until they own the property. Can we do this? Hi Clark I do not provide personal tax patent prosecution work from home on this blog.

However, that being said, I think your plan is impractical if you do it on a yearly basis.

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I suggest you seek legal or tax advice before undertaking any gifting and would the new adventures of pippi longstocking film location making it a single gift or maybe two or three assuming the forex trading 15 minute turbo course provide for the gifting in the first place.

Hi Mark, My friend is an only child and lives with her elderly and ill aol stock market portfolio her mother has passed in a very small home 12kms from Sydney CBD. She is his part time carer though he will require more care in due course.

Her occupation is as an elderly carer. Is the following scenario feasible? Is this feasible or am I overlooking something - else is there a nasty tax implication. Both her and her dad a very cash poor. Hi Paul Sorry, I am Canadian, I have no idea about stamp duty tax. Hi BBC, My parents moved out of their condo into a retirement home several years ago when their memories started to go.

My dad died 3 years ago and my mother is now living with Alzeheimer's in a full care nursing home. When they moved out of the condo myself and siblings sold the condo and divested all of their assets and added the proceeds to their existing investment portfolio. When my dad died my mother was the sole beneficiary of his estate plus she still receives the full pension that my dad had as a survivor benefit.

This is more than adequate for her maintenance in the home. This is accumulated income from the capital invested and not used. Hi Anon Power of attorneys are legal instruments and not tax instruments. I am pretty sure of the answer, however I dont like to play lawyer, so u should ask a lawyer. I understand and I'll do as suggested. Thanks for getting back to me. BBC, Eye-opening post, thanks but reading some of this has the hairs raising on the back of my neck.

These implications have the potential to ruin the finances of ignorant people. Definitely worth reading up on before selling properties to anyone. I think by now after reading all these comments that I get the picture: But I just have to ask: For arguments sake and to make it more realistic, I would want to read advice specific to where the husband is the only Employed spouse, and the wife is self-employed from home.

I am not aware of any specific articles. Here is the issue in a nutshell. You want the lower income spouse assuming ur wife's self employment income is less than your full time employment to in general have at least partial ownership, if not full ownership. The issue with 1 above, is technically you cannot use the higher income spouses money to purchase and put the lower income spouse as the owner of the property. I say technically, because I see the income tax attribution often ignored in real life.

However, what is limit price in stock market you note, it would be best to speak to an accountant before purchasing who could review ur specific situation in detail.

My parents have just moved to a long term care facility, and they want to gift their house principal residence to my sister who rentsand change their how to learn strategies for binary options to then split any cash assets between my brother and I upon their death. Question is, are there tax implications eg capital gains that would affect my father for gifting the house to my sister?

And would land transfer taxes also apply? I'm my parents power of attorney and will consult a lawyer of course, but really wanted a general guideline on gifts of living parents to a child. I know they can give us cash gifts now freely and they have from time to time, but gifting property I imagine is quite a different thing. I have written about this issue multiple times on my blog. In general, other than potential land transfer tax check with your lawyer if it applies the transfer of a principal residence to a child who does not have their own PR, should not create an income tax issue.

Anyways, you need to sit down with an accountant and lawyer to ensure your parents plan is tax and estate effective based on all the assets they hold. Thank you very much. I did indeed contact our family lawyer today. There are some issues still to deal with And with both in long term care and bills already starting to pile up, plus they're supporting my sister who just quit her job Hi Mark, Thank you for your advises on this website.

I live in Ontario and I have inherited a house from my father. The house is overseas and I inherited it with my siblings. We have recently sold the house and I am about to transfer the money to my account here.

The money is the sale of the inherited house. Will I be taxed? What do I need to proof the inheritance other than the sale contract and the death certificate? Hi Anon I do not provide personal tax advice on this blog. That being said, in general, when u inherit a house that is not a principal residence, why buy individual stocks deceased should report a gain equal to their cost less the fair market value on their final tax return.

The children inherit the house at the fair market value on the parents death. Thus, in your situation, most likely you have a gain equal to the selling price less the value of the house on the passing of your father, that must be reported in Cda and maybe the overseas country. You need to get some income tax advice to sort this out. I have a question about selling shares from a mutual fund. My father-in-law is selling the shares to pay for a legal issue of mine. Is there a way to transfer the tax bill related to that to myself and my husband.

We don't think it's fair that he is helping us, but going to have to pay income tax for it. How could we effectively make us responsible for the approx. Hi Anon You cannot transfer the tax bill. Not sure why you dont think it is fair, it is your father in laws mutual fund and tax, what he does with the money, is not the CRA's concern. He could have just lent you the money using a line of credit or similar vehicle to have avoided the tax issue.

We do not have a principal residence, currently we live in an in-law suite with our daughter. When the time comes, we will probably move into the home. Should I be speaking with a layer, accountant or an estate planner to ensure that we are not in a jackpot in the future? Hi Anon I do not give specific personal advice on this blog, that said, this may be a flawed plan. Your parents will no longer own a principal residence and you will not live in the PR you own and thus, u may be converting your parents tax free PR into a taxable property.

Definitely speak to an accountant before u do anything. A few years back, my parents "sold" my wife and I some land for the " sum of one dollar and other goods and how to make gold fast wow 5.3. I think the answer is where can i get personalised christmas stockings first option, but just wanting confirmation.

Also, if it isn't clear, I am referencing "liable" from a capital gains perspective. Read this link, it discusses your issue. If not, you may want to to revisit this transfer with an accountant and the lawyer who made the transfer to see if anything can be done to avoid the potential negative income tax consequences at the time of the transfer and in the future.

Hello Mark, I think I'm in a nightmare. In my brother was diagnosed with colon cancer. In March he prepared a will that would leave me his home Also in March he decided to go ahead and prepare a warranty deed to have my name as the legal owner before he died.

In July of he died. I'm sure I will have to pay some capitol gains on this transaction, but will Msdn process waitforexit have to broker for bombay stock exchange capitol gains on the I did not probate the will in because there was no contestants among the family. Hi Anon Speak to a tax lawyer.

I cant say if there is an argument for a distinction. Hello, I have transferred a sum of money to my brother. My brother trades on the basis of orders received from a financial investor that I subscribe to.

The money was transferred because my own employer has a trading policy in place which prevents short term trades. As a result, the intention is for my brother to execute the trades from the service. I have checked with my employer that a trustee in this case my brother acting on my behalf executing trades that I prize money british open golf no control over my brother only executes the trades directly provided by the subscription service is not a violation of their trading policy.

At the time when I eventually do leave my employer I intend to have the funds transferred back to me. Given my intent, how do we go about ensuring that there is no US tax burden for my brother when he eventually does transfer the cash back at my request. Hi Anon I am not a US tax expert. The US has some stringent gifting laws.

Your brother should check with a US accountant whether he will have any issues. Hi, My father's house is completely paid off. He is getting re-married and wants the house to stay in the family stay with his 3 kids- All above 18 years old. My question is about the latter 1. I am assuming the transfer will be considered a gift, free nx cash generator combat arms eu means deemed disposition at FMV.

The home has definitely increased in value, it was originally purchased forand is worth aboutWould the principal residence exemption prevent him from having to pay on the capital gains? What are the tax implications for the children or do we only have tax implications when the property is sold. Please provide some detail. Note one sibling has a separate home and the other 2 still live at home 60s binary options system trading platform do not have any other property.

What are the tax implications for my dad once the property is sold. Please provide any other details you think would be helpful Your article was helpful Thanks. Hi Anon Sorry, I do not provide personal tax planning advice on this blog. You should get proper tax advice before undertaking this transaction.

My husband and I would like to buy it from her. She says she would rather gift it to us to avoid paying taxes. First of all, I do not understand the "gifting" process, does she just change the name on title from hers to ours? Hi Gail I do not provide personal tax advice on this blog, also, I am not a lawyer. That said, in general you need to have a lawyer draft a deed of gift and transfer the title of the property, but confirm with a lawyer.

Also, you need to check with your lawyer if there will be land transfer tax. Hi Mark, Great Blog. My question is, when my father was dying he traded her a residential rental property for consideration in her part of the family cottage that she would have received through survivorship and Willed the cottage to his adult children.

He passed away a month later and now she is questioning if the Estate she is not executor has to pay the Capital Gains, which would be significant, or if she will have to pay on the whole value when she goes to sell it? The Lawyer has not yet registered the property in her name or provided her with a new deed for the property even though the transfer took place nearly 2 years ago.

Thank you for your help. Hi Anon This is a very complicated question and way too complex to answer on a blog. You need to meet with your accountant or engage one to sort this out properly to minimize any income tax consequences. Hello Mark, What are the tax implications if I buy a cottage off my parents for less than fair market value? Thanks for your help! I would consult with an accountant, as there may be a practical way around this.

Her husband passed away a few years previous to this transaction. She passes away and now grandson is selling home. I have been told there is a different calculation for the grandson i.

Any help would be appreciated. Hi Chad Upon the gift to her grandson, grandma would be deemed to sell her PR. Assuming she lived there her entire life and make money on android ebook pdf no other properties, that gain should be subject to actual facts tax free as her Principal residence. Grandsons cost is the market value of the forex pip and margin calculator at the time of the gift.

If Grandson did not use the house as his PR, then the gain will be the difference between the value at the time of the gift and when he sells. Hi, my mother transfered her house to me in but she was re assessed by CRA forand Hi Anon This is a very complex matter. I am in Ontario. My mother has passed and I want to transfer the house into my name. Hi Mike I am a tax accountant, this is an estate lawyer and real estate lawyer question. If you have an estate lawyer, you need to ask them, if not you will require a lawyer for the transfer anyways and you should ask them, Sorry, not my area.

Hello, Mark, I'd like to ask you a few questions: Are joint tenant and joint ownership the same? Will uk managed forex accounts be any tax liability for me after I pass away and my best friend? My best friend's name is not on my present Will I appoint somebody else to inherit my principal residenceshould I revise my Will to have my best friend inherit my principal residence or I don't have to do so as long as I add his name onto my principal residence as a joint tenant?

If I sell my principal residence, I won't have capital gain tax. If I move to my rental property and convert it to be my principal residence, when I sell this property in the future, say, after a few months, will I need to pay any capital gain tax for the sale? If I give my principal residence to my best friend as a gift, will there be any capital gain tax? Who should pay it, my best friend or I? Many thanks for your help!

Hi Bai, Sorry but I do not provide specific personal tax planning answers on this blog which you are requesting. Here is link to diff between joint tenancy and tenancy in common http: Hi, My ex wife has a secondary rental income. She is required to reveal her rental income in addition to her T4 make money with flash fiction in order to calculate child support.

I would assume your separation forex autoscaler review requires her to provide you details of this income ask your lawyer if u r not sure. Assuming so, request a copy of her T rental income form I can not comment in a vacum not knowing what other expenses such as prop taxes, repairs, int x, depreciation she how much money does tiger woods caddie make each year claiming.

Its been three tax implications company buying back shares and everyone wants to split up the properties equally. Can this be done without tax problems? Hi Anon I cant answer without knowing the terms of the trust.

It may be possible depending upon the terms. You need to speak to the estate lawyers or accountant who is aware of the details. Hi, So this has come to light due to retirement planning purposes that I'm doing for my parents.

OAS and GIS seem to be based on the previous calendar year's income to determine how much they can receive mom turns 65 in so it would be based on 's income. They have a rental property that they intend to sell but if we want to avoid having the CGs showing up in their income in can they just gift their rental house to me in the year and pay the capital gains tax in instead?

That way, their annual income in would still be low. Also, are there special forms to fill out for this? I don't see anything aside from Schedule 3. Does an official change in the title of the house have to happen or how would that work? Hi Anon Sorry, but I dont provide personal tax planning on this blog, especially the gifting of property that has various tax consequences, speak to your accountant or engage one.

What's considered gifted as a property under the eyes of CRA? Anon, gifts are not defined in the Income Tax Act. It would be the everyday meaning and that of the courts. The courts in a donation case considered a gift to be a voluntary transfer of property in return for which no benefit or consideration flows. However, that is only one definition. Ok, this is an interesting one. My Mother, My wife and I jointly bought a house with an in law suite 3 years ago in BC with intent of mother moving into suite.

Prior to buying house, my wife and I already owned a condo. After purchasing house and prior to selling condo my mother decided she'd rather live in condo instead and we essentially swapped property Mother getting condo, Wife and I getting house but not officially. House is in my wife, mother and I's name. Can we declare principal residence on condo and dead trigger 2 money hack cydia sell and then have mother declare personal residence on house at a later date and avoid capital gains?

Can we simply transfer ownership of condo to mother before selling without accruing capital gains? Planning on seeing an accountant but would love your thoughts on situation. Hi Anon I do not provide personal tax planning advice on this blog. My concern is that the facts may not fit what you wish to do. It is a pretty complicated situation, your accountant can take the time to review the facts and determine the year by year gains and then help u make the best decision. Hi Me Mimi I do not provide personal tax planning on the blog.

You should speak to an accountant before you undertake this transaction as the answer will depend on various facts.

Hi, I have a house under my name only. My sister family and I lived there until i get married. I moved how much money does an electrician make rental property few years ago and my sister family live in that house. Now i am planning to buy a new house under my name and my wife name.

I am wondering can I transfer the existing house to my sister without showing any tax gain? Can I do it as gift or need to sell to her?

Tax when you sell shares: Selling shares in the same company - unyyozeqy.web.fc2.com

Do I need to do it before I buy new house for us or we can do it after i get the new house? Since it is within family, i am not going to get any money for transferring so I want to make sure i don't need to pay any tax for it. Hi Anon I dont provide personal tax planning advice on this blog, speak to an accountant.

Whether you can transfer your house free would depend upon various factors such as how many years that property was your principal residence, as I said, get tax advice. My husband would like to add my name to his rental property deed with right of survivorship, I will be living in one of the units if he passes before me.

I will be giving him no money in exchange as he would like me to have this property. My parents are not capable of maintaining their home and want to gift it to me less the difference owed on the mortgage.

No one is living in the house right now. My brother has down syndrome and is in a community living facility. I want to take ownership of the home. Can you tell me the best way to go about this. Sorry Anon, I do not provide personal tax planning advice on this blog for obvious reasons. Hi Anon On the main page there is a hire the blunt bean counter link, however, I only take on corporate clients, so if it relates to transferring property to family members unfortunately I do not take on personal tax work.

What happens when I own a 2nd property not my primary residence and I have had my sister living there for 3 years rent free. She only pays all the expenses. What happens in this case tax wise? Hi Anon I do not provide personal tax planning on this blog. Hi Mark, Wouldn't the tax implications be zero if: The property was gifted for "Love and affection" with no money changing hands.

The children moved in and made the property their legal primary residence. The house was large enough for the parents to continue living there and they didn't have a life interest in the property. Hi Anon I don't provide personal tax planning advice on this blog.

I would suggest however that if you reviewed your plan with your accountant, it may work depending upon the facts. I gifted shares to my child when she was a year old. Now she is 15 and I farmers livestock market calgary blackfoot to crystallize some of the capital gains that have accrued on the shares.

I have been claiming the attributed dividend income since the gifting. After I sell the shares, what are the rules regarding attribution? I've been paying tax on the dividends of the shares. Hi Anon I do not provide specific tax advice on this blog. However, here is a link to an article on the topic http: We have two acres of land on an island that have been in our family for over years. We will never sell. One property has my moms name and mine and my two sisters on the title. It is my moms primary residence.

The other property has mine and my two sisters on the title and it is my sisters primary residence. We all use the property all the time and all live there in the summer. We don't bother with wills or lawyers and as people die I want it to be easy to just keep on going so I want to add my nephew to that title now that mossberg plinkster replacement parts is I plan to add the other 5 kids too as they reach I was sent a Form A freehold transfer form but I don't think this is right.

I'm not transferring anything to my nephew just adding him to the title. I just want to do it myself and they diamond foods stock market I could go torgovpya platform of binary options a notary and fill out the information but I fear it isn't really the right form. Do you have any advice?

Hi Anon My advice and I cannot stress this more strongly, is to get proper tax and legal advice. By ignoring reality and trying to keep this easy and not use lawyers you have multiple possible tax and ownership issues in regard to your mom and sister claiming the Principal residence exemption and various potential tax considerations if you add other names to title. Get professional advice now!! Hi Mark, If two people own a residential property and one wants to buy out the other, at FMV, do they have to pay land transfer taxes?

If so, is the tax on the full value of the property or just the "half" they are buying? Hi Anon You would have to check with a lawyer in your province. There is a love and affection clause in some provinces, so you may or may not be exempt. It would typically just be on the half you purchase, but confirm with the lawyer. Hi Mark, My mother and brother have a house in their name.

My brother and I live their. The mortgage was set up in their names in because their credit rating was much better at the time. I have paid everything including down payment to this point and monthly mortgage payments all along.

I now wish to have the house put in my name. If not what is the best possible solution. I am in Oakville Ontario. Hi mike Sorry but I do not provide personal tax advice on this blog. Does that mean you do provide personal tax advice in some other blog or independent of the blogs or personally. Hi Mike Sorry, I don't provide personal tax advice in blogs or personally unless someone is a corporate client.

If you dont like how I answer questions, dont read the blog. You will see probably over a questions answered if you read all the blogs. I dont answer fact specific questions because a I am not provided half the facts most of the time b and I am not a free tax service, I earn my living answering these questions for money.

I think even if i never answered a question, this blog provides substantial information that you would have to have paid significant dollars for if you got it from an accountant. Have a nice day. If i'm purchasing a new home, is it possible to take advantage of first time buyers benefits if my wife purchase the home? Here are the eligibility requirements http: What happens when 2 siblings inherit their Dad's house.

One of the siblings was living in the house, so it was his primary residence. The father, on the other hand, was living with his common-law spouse in another home.

What I don't know for sure is if he still declared that home as his primary residence. The question is the other sibling, who has now inherited half the house, owns his own home. What is the best way to avoid capital gain and other taxes in this situation. Hi Anon Sorry, but I cant answer a question without all the facts which u do not have regarding your fathers PR and anyways, I do not provide specific tax advice on this blog. Despite the similarity to your inter vivos situations, and existence of consideration e.

Hi Anon Interesting question. In my experience, the CRA has always deemed the deceased persons property disposed at FMV and they have always allowed the person receiving the property to have acquired it at FMV.

I was appointed executor at that time also. There are 5 brothers in the family. My father died in Here is my problem, my mother died in Jan of and as executor of the estate I have run into a problem with the property trying to be controlled by the brother who the property was transferred to.

As executor to the estate I want the inheritance to be fair for all brothers and have requested the property be transferred to all brothers and since no one really wants to sell the property and wish to keep it in the family with another brother living there and paying a small so called rent.

I want to set up an account and use this rent money to pay the taxes and homeowners insurance and upkeep on the house and property. How do I approach this and still try to keep peace in the family.

Hi Anon This is a bit messy and beyond my expertise, you would have to ask an estate lawyer, sorry. Hi, how about parents transfer principal residence to the son, and the son has no property at all.

Hi Leo I do not provide personal tax planning advice on this blog as I would need to know all the facts including where your son lives. That being said, in general, subject to any land transfer taxes, a transfer of a principal residence to a child that has no principal residence and who lives in that PR, will typically be tax free for that child. However, you should speak to an accountant or lawyer about your specific fact situation before you undertake such a transfer to ensure there are no taxes of any kind resulting and that the home would qualify as your sons PR going forward.

Hi, I am moving to USA for work on TN visa along with my spouse and kids. I own a principle residence in Canada which will be sold before moving to USA. However my wife also own a condo where currently her parents are living.

Will she have to transfer the condo title to her parents before moving to US? That being said, your wife does not necessarily have to transfer the condo, but there are potential income tax and non resident withholding tax issues.

I suggest you seek tax advice to understand her options. Hi Mark, I love your article! However, I am still confused about the following statement and example: Are you saying only the gift of whole property preserves the FMV for the purchaser?

Or in this case, is this fine? In the transferring property scenario, it would be equivalent to parents helping with a portion of down payment or a "gift of equity".

Would this be still the messy double taxation scenario? I suppose I am trying to understand the difference between: A gifting the whole property: Is this more like "A" no double tax or "B" double taxation? If you are considering doing anything of the sort, obtain tax advice. Mark, I know both shares and real estate are 'property', but the question above I believe goes from your example following the quote, involving shares, to consideration of real estate property.

Even on the same day, as long as the transactions are separate, CRA can't somehow stitch them together: Anon, sorry, but I do not provide personal tax planning advice on this blog. You gift an asset to yourself from a controlled corporation at FMV. Later, maybe very soon? Or maybe you just scrap them. Can you now claim a capital loss from the FMV of the original transfer?

I assume when u say gifted yourself from a private corp, you reflected it in your corp as either a deemed sale or shareholder advance? Sounds fishy to me that the assets would decrease in value "very soon". Anyways It sounds like these assets are depreciable property in which case you cannot claim a capital loss. I own a home in one city in Alberta.

I bought a condo in another city to use when I am in that city often and for my daughters to live in while they attend university. They pay no rent and it is not rented out to a tenant. It is considered "owner occupied" because our children live there, and we use it as a second home?

Would we be considered as "owner occupants" even though it is not our primary residence? We certainly are not landlords. Hi Steve I am not sure what you are getting at by saying owner occupied. It is not a tax term and has no meaning to me.

What is your actual question. Hi, I have a question and here is the scenario He would like to give them to me today. My notary I'm in Quebec, Canada wants to call the transfer a donation and says it will be beneficial to us. An accountant I spoke to says that might not be the case.

I'm trying to figure out the best way of paying the least income tax for both my brother and I. What should I do? Hi Sylvie I do not provide personal tax planning advice on this blog, but at least in Ontario and I am pretty sure in Quebecyou cannot call a gift a donation unless it is made to a registered charity.

Engage you accountant to properly plan for this transaction to minimize the taxes. Mark, If a couple buy a house jointly principal residencecan the proceeds of the house, upon sale, be put into the name of only the lower income spouse, while the higher income spouse uses his savings to buy them another house in both their names?

I'm wondering if this might be an effective income splitting strategy. Hi Anon Technically the house proceeds belong to both spouses and there would be attribution. The county requires title be changed on the lots within one year.

What is best way to do this so lots may be held on to for future sale. Hi Anon I do not provide specific tax planning advice on the blog. Your question is complicated, you need to engage an accountant. Mark, my elderly mom is trustee along with her elderly bro and sis of 70 acres of farmland. Mom's sis is now in a nursing home and her kids want to sell her home to pay the bills. That home is on the frontage of the 70 acres, on its own lot. But to make the home "up to code", the kids need to extend the sewer line into part of the 70 acres, and so they've asked my mom and her bro to "give them" roughly 50 feet of the farm land behind aunt's house.

Mom wants to help her sis, but she's wary, thinking of gift tax implications and also how the dipping into the acreage might affect the divvying up of the 70 acres when it sells in total. Any suggestions on how Mom might help her sis and do so in an IRS-pleasing way? Hello, As a parent who owns a property in Quebec, I would like to transfer the property to my child who lives with me.

Does he have to pay again the welcome tax for the property? Hi Sarah I have no idea about Quebec tax and the welcome tax. Please engage an accountant from QUE who can assist you. Hi Mark, My father is the primary owner for home that he has owned for 30 years. He is now having health problems and wants to transfer ownership to me.

If he creates a Last Will Testament and "gifts" me the property what are the fees and income tax implications? Also, would the transfer affect my first time buyer status? Please engage an accountant. My father has decided to 'gift' my wife and I his rental condo, however he is concerned with the capital gains tax. Is it simply FMV-His purchase price?

Based on his marginal tax rate? Is there anyway to avoid the capital gains tax through a private sale or would we have to pay it later on? Hi Zach The cap gain would be the FMV less his adjusted cost base purchase price plus additions. However, he may also have recapture of depreciation if he claimed CCA for tax purposes. You cannot avoid the tax through a private sale.

My brother is in abroad and he has a property in Ontario. I have to take care the rest of the mortgage. In addition, there could be significant reporting and withholding tax issues for non-residents, so before you do anything, get some tax advice.

A friend of mine that is located in southern Ontario is renting a house from her ex father in law. She is also renting the house with her children and their families. What she would like to know if the house can be signed over to her or her legal aged children grandchildren to the owner? The house was purchased in for approx. There has never been a mortgage on the premises. If this could be done will there be any capital gains, if so would you know how much that would be?

Sorry Anon, I do not provide specific tax planning on this blog. My friend and I are considering purchasing 1 or 2 condos for the purpose of investing in and building equity for our daughters both are currently 10 years old. We are not looking into making this a business income. At some point in time when they are much older and wiserwe will be transferring the equity to our daughters and they may choose to live in it, continue to maintain tenants, or sell it as they wish.

We are debating whether to set business as partnership or incorporate. Your comments would be greatly appreciated! Hi Anon I do not see much benefit to using a corp. Keep in mind when you wish to transfer the condos to your dtrs, there will be a deemed disposition at the fair market value. Having the properties in a corp and then transferring to your dtrs would be far more problematic.

If you buy two condo's, you should consider just each owing them individually as partnerships can also be problematic if one partner needs money etc. Hi Mark, I appreciate you taking the time to write this article and responding to people's comments. I have a related question: In the case where two brothers who own a property jointly wish to transfer ownership to their father alone as a giftI understand that there will be a capital gain tax that the brothers will owe to the CRA as well as taxes on gains if the father sells the property subsequently.

What other options are available to accomplish such a transfer of ownership? Hi Anon No, the gain would be at the time of transfer fair market value of property less cost even though the property is not sold not when dad sells. I dont see any other options, but speak to an accountant and provide all the facts. I need some advice on transferring property that was left to myself and my adult daughter, by my father I was told that the best and cheapest way to transfer the property into our names was to wait for 3 years and it would automatically go into our names I was also told by someone else not to do that because all property owned by my father had to be sold or switched into another name within 1 year of his death I am so confused.

Hi Deb, sorry, I do not provide specific tax advice on this blog. Since you note 3 years, I am thinking this is real estate. If so, get professional advice, as this can be a very complex issue I am going to have an estate expert write on this issue in the future.

My husband and I own a small second home in the Adirondacks paid in full. He will pay us in cash over a 4 year period.

Can we do a warranty deed, pay state tax and be done with it? Hi Carole It sounds like you are American, if so, I am a Cdn accountant and you should speak to a US accountant. If you are Cdn and have a US property, there are both US and Cdn tax issues and this is unfortunately a bit of a complicated transaction and you should again speak to a Cdn accountant who also has US tax experience. Hi Mark, If I sell my rental property to my daughter, theoretically hold the mortgage for her, then all that would be involved would be a normal transaction of land transfer taxes for her and capital gains for me?

Hi Wondering From an income tax perspective, yes you would have a deemed capital gain. I cannot comment on the land transfer tax as I am not a real estate lawyer.

There is a love and affection provision, not sure if you could access that provision or not. However, as our daughter is now having serious medical issues, I believe we mistakenly put the condo ownership in her name. Naturally we are afraid of losing our money.

We are thinking we should have the condo ownership transferred to us. Do you think this would be a wise move? Or if we left ownership in her name, would a Will be suffice? Or what if we became joint owners with her? We need to come up with a solution which will result in the least amount of financial loss should anything happen to our daughter.

Thank you for any information or suggestions you might have. Hi Anon Sorry I do not provide specific personal tax planning advice on this blog. I would speak to an accountant who can help navigate you through the issues your face. I have seen reference, several times, on various advice blogs from lawyers or accountants, to a means whereby: A parent who has or perhaps who has in the past but not recently declared a property as principal residence, dies. A child or other close family heir, of age of majority, moves in.

Principal residence exemptions PREs of the child can apply back as far as they have them available The sources I saw referred to this transfer happening before the estate was closed, and that transfers after the estate was closed would not qualify for this quite favourable treatment.

Is there a law, rule, technical interepretation TIor tax ruling you are aware of that speaks to all this? Sorry Anon, I have no clue what u r talking about. Can you provide a link? Capital loss rules on death are hard to understand.

One option, I understand, is to form a T3 trust for estate assets and liabilities, to allow more time to figure out what to do with capital losses. What are the advantages of this approach when investments are made in real estate, but appear difficult to liquidate in a hurry?

If a PRE has been used and PREs will continue to be used either personally by an heir or by a trust for multiple heirs to shelter a residence going forward, is there any problem with using capital losses against land gains in excess of 1. If that land is not personally used but held in speculation or for development, for instance? Would undeveloped lands reasonably count as PUP at all?

Also, are these rules about PUP only applicable to net capital losses? Investments in a residence or PUP that simply counter gains but produce a net zero loss are always acceptable to write off against gains, is that right?

Hi Anon Your questions are way to complicated for a blog answer. You should engage an accountant to help you navigate your issues as they are not simple answers. Hey Mark, I want to sell my house to my mother and not sure how it will work with taxes.

I bought the house 5 years ago, lived in it for 1 year and had to move miles away because of military service and rented the house out for the last 4 years.

I used a property manager for the rental. My mother needs documents proving she reinvested her money into another property to avoid paying taxes. Is it possible to avoid paying CGT on my side? Would I be able to have her payoff the mortgage and we transfer the deed to her name? Hey Ian Sorry, but I don't provide personal tax planning advice on the blog.

I assume you did not make a 45 2 election when you starting renting? I am not sure if there is a special Military provision. You should engage a local accountant to assist you.

Hi Mark, I have a house in ontario where my sister and I bought inmy parents and brother also live in it. What do I do to avoid tax implications, do I take my name off the mortgage with my sister, do I leave it as is, do I add my brother instead of me, please advise. My name is Mark Goodfield.

I am a Chartered Professional Accountant and a partner with a National Accounting Firm in Normal 0 false false false EN-US X-NONE X-NONE Toronto. This blog is meant for everyone, but in particular for high net worth individuals and owners of private corporations. The views and opinions expressed in this blog are written solely in my personal capacity and cannot be attributed to the accounting firm with which I am affiliated.

Monday, May 27, Transferring Property Among Family Members - A Potential Income Tax Nightmare. These transfers often create significant income tax issues and can be either errors of commission or errors of omission.

Over my 25 years as an accountant, I have been referred some unbelievably messed up situations involving intra-family transfers of property.

Most of these referrals come about because someone has read an article and decides they are now probate experts or real estate lawyers have decided they are also tax lawyers. Transfers of Property - Why They Are Undertaken Many individuals transfer capital properties real estate and common shares, being the most common in and amongst their families like hot cakes.

Some of the reasons for undertaking these transfers include: I will not discuss the first reason today because it is legal in nature.

But be aware, Section 1 of the Income Tax Act can make you legally responsible for the transferor's income tax liability and there may be fraudulent conveyance issues amongst other matters. Transfers of Property - Income Tax Implications When a property is transferred without consideration i.

If the property has increased in value since the time the transferor first acquired the property, a capital gain will be realized and there will be taxes to be paid even though ownership of the property has stayed within the family.

There is one common exception to the deemed disposition rule. This difference is best illustrated by an example: It must be noted that if Doug sells the shares in the future, Mary would be required to report the capital gain realized at that time i.

As noted in the example above, when transfers are made to spouses or children who are minors under the age of 18the income attribution rules can apply and any income generated by the transferred properties is attributed back to the transferor the exception being there is no attribution on capital gains earned by a minor.

The application of this rule is reflected in that Mary must report the capital gain and any dividends received by Doug. In English, what these last two sentences are saying is that if you legally gift something, the cost base and proceeds of disposition are the FMV. A strange result considering he actually paid you. Transfers of a Principal Residence - The Ultimate Potential Tax Nightmare I have seen several cases where a parent decides to change the ownership of his or her principal residence such that it is to be held jointly by the parent and one or more of their children.

When the property is eventually sold, the gain realized by the parent on his or her half of the property is exempt from tax since it qualifies for the principal residence exemption; however, since the child now owns half of the property, the child is subject to tax on any capital gain realized on their half of the property i.

The blogs posted on The Blunt Bean Counter provide information of a general nature. These posts should not be considered specific advice; as each reader's personal financial situation is unique and fact specific.

Please contact a professional advisor prior to implementing or acting upon any of the information contained in one of the blogs. The Blunt Bean Counter at 6: Share to Twitter Share to Facebook Share to Pinterest.

We are planning to visit an accountant but would appreciate any input you may have', 'timestamp': You would have to ask a family law lawyer, that is not my area', 'timestamp': I suggest you speak to your accountant if you have one or engage one to explain the ramifications of your situation', 'timestamp': See my blog next week for the answer to your 2nd question', 'timestamp': Will do ', 'timestamp': Have a nice day ', 'timestamp': In my experience, the CRA has always deemed the deceased persons property disposed at FMV and they have always allowed the person receiving the property to have acquired it at FMV', 'timestamp':