housing tax on Canadian house sale
QUESTION:
We are American citizens who have lived in Canada for 9 years. We sold our house here and have purchased a house in the states. Do we have to pay tax on the money we make on our Canadian house sale?
------------------------------ david ingram replies:
You are getting the only question answered in two days. Been Too busy for others.
There is no tax on the house in Canada because (in genereal) we do not tax any profits on the sale of a principal residence.
However, the sale is subject to Capital Gains tax if the profit was over $500,000 US.
From the looks of your email address, I get the idea that you are in Drumheller or High River, Brooks or another smaller Alberta town which means that although your home will have increased significantly in value, it has not likely hit the $500,000 US profit range.
You should report the profit on US Schedule D, Part II, line 8. If the profit is less than $500,000 ($250,000 per person) deduct it on the next line under Section 121. If the profit is over $500,000, you would deduct $500,000 under section 121 and owe tax to the US IRS on the balance at a maximum of 15%.
Glad to file the retuirns for you if you have a problem.
We are American citizens who have lived in Canada for 9 years. We sold our house here and have purchased a house in the states. Do we have to pay tax on the money we make on our Canadian house sale?
------------------------------ david ingram replies:
You are getting the only question answered in two days. Been Too busy for others.
There is no tax on the house in Canada because (in genereal) we do not tax any profits on the sale of a principal residence.
However, the sale is subject to Capital Gains tax if the profit was over $500,000 US.
From the looks of your email address, I get the idea that you are in Drumheller or High River, Brooks or another smaller Alberta town which means that although your home will have increased significantly in value, it has not likely hit the $500,000 US profit range.
You should report the profit on US Schedule D, Part II, line 8. If the profit is less than $500,000 ($250,000 per person) deduct it on the next line under Section 121. If the profit is over $500,000, you would deduct $500,000 under section 121 and owe tax to the US IRS on the balance at a maximum of 15%.
Glad to file the retuirns for you if you have a problem.
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