capital gains tax in Canada for condo owned by non-residents -

 
QUESTION:

I own a condo in Vancouver with my partner.
I am a Canadian and US citizen, residence in Hawaii.  XXXX is an American citizen with residence in Hawaii.  Are our capital gains rates different if we sell the condo?
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david ingram replies:

Your citizenship is neither a plus nor a negative in the calculation because you will be taxed as a non-resident.

In general, Canada's progressive tax rate ranges from about 23% on amounts under $36,000 to 44% on amounts over $120,.000

But only 50% of a capital gain is taxable.

If the unit has gone up $400,000, you would each be taxable on one half of $200,000 or $100,000.  The tax on $100,000 is about $29,000 each.

When you go to sell it, you must fill in forms T2062 and T2062A within 10 days of the actual sale or pay a $25.00 a day fine for every day late with a minimum of $100.00 and a maximum of $2,500.  That would be each of you.

Then, you would report the sale again on US schedules 4797 and D if you had rented it out and schedule D if it was not a rental.

Any tax paid to Canada would be a federal foreign tax credit on US form 1116. Hawaii will also give you a credit as tax paid to another jurisdiction.

We are happy to asssit you if you need help. Today, we are doing the paperwork for California and Colorado and Washington State residents.

This would also be a good question if you wanted to phone the radio program on Sunday Morning.  It would be a long distance call to 604-280-0600 but the answer would be free.  If yo call my office for the consultation, the fee is $400.00 Canadian and you have to pay for the phone call as well as explained further below.

You can hear the program live in Hawaii at www.600am.com.  It is on from 9 AM to 10:30 AM Vancouver time every Sunday morning which I think is 6:00 AM to 7:30 AM your time

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Disclaimer:  This question has been answered without detailed information or consultation and is to be regarded only as general comment.   Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist for expert help, assistance, preparation, or consultation  in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included." e bankruptcy expert  US Canada Canadian American  Mexican Income Tax help.
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Phone consultations are $400 for 15 minutes to 50 minutes (professional hour). Please note that GST is added if product remains in Canada or is to be returned to Canada or a phone consultation is in Canada. expert  US Canada Canadian American  Mexican Income Tax help.
This is not intended to be definitive but in general I am quoting $900 to $2,900 for a dual country tax return.
$900 would be one T4 slip one W2 slip one or two interest slips and you lived in one country only (but were filing both countries) - no self employment or rentals or capital gains - you did not move into or out of the country in this year.
 
$1,100 would be the same with one rental
 
$1,300 would be the same with one business no rental
 
$1,300 would be the minimum with a move in or out of the country. These are complicated because of the back and forth foreign tax credits. - The IRS says a foreign tax credit takes 1 hour and 53 minutes.
 
$1,600 would be the minimum with a rental or two in the country you do not live in or a rental and a business and foreign tax credits  no move in or out

$1,700 would be for two people with income from two countries

$2,900 would be all of the above and you moved in and out of the country.
 
This is just a guideline for US / Canadian returns
 
We will still prepare Canadian only (lives in Canada, no US connection period) with two or three slips and no capital gains, etc. for $200.00 up.
 
With a Rental for $400
 
A Business for $400 - Rental and business likely $550 to $700
 
And an American only (lives in the US with no Canadian income or filing period) with about the same things in the same range with a little bit more if there is a state return.
 
Moving in or out of the country or part year earnings in the US will ALWAYS be $800 and up.
 
TDF 90-22.1 forms are $50 for the first and $25.00 each after that when part of a tax return.
 
8891 forms are generally $50.00 to $100.00 each.
 
18 RRSPs would be $900.00 - (maybe amalgamate a couple)
 
Capital gains *sales)  are likely $50.00 for the first and $20.00 each after that.

Catch - up returns for the US where we use the Canadian return as a guide will be $150 to $500.00 depending upon numbers of bank accounts, RRSP's, existence of rental houses, etc.

Just a guideline not etched in stone.
 
 
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