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Arthur Rubin
Arthur Rubin, Tax Preparer
Category: Capital Gains and Losses
Satisfied Customers: 1496
Experience:  Over 22 years of tax preparation experience.
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My wife and I and her mother are joint owners with

Customer Question

Customer: ***** *****, my wife and I and her mother are joint owners with survivorship on a cottage, once mom passes away is there capital gains tax or does it just become ours and all we have to do is have her name removed
JA: Thanks. Can you give me any more details about your issue?
Customer: Family cottage in Sask.
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Submitted: 1 year ago.
Category: Capital Gains and Losses
Expert:  Arthur Rubin replied 1 year ago.

Thank you for using Just Answer.

Assuming you, your mother-in-law, and the property are in Canada. her estate pays capital gain taxes on the deemed sale of the 1/3 of the cottage she owned at death. In your hands, the basis is 1/3 of the value at death + 2/3 of (the cost at acquisition + improvements before her death) + improvements after her death.

If you need more clarification, don't hesitate to ask.

Customer: replied 1 year ago.
Is the cottage part of estate in probate if it is right of survivorship on title for the three of us
Expert:  Arthur Rubin replied 1 year ago.

Technically, that's not a "Capital Gains" question, and it's not formally in my field of expertise, but it isn't in the probate estate.

If the probate estate (or the estate managed by the executor, which might be slightly larger) is inadequate to pay the capital gains taxes, the CRA (or whatever it's called now) can go after the beneficiaries.

Expert:  Arthur Rubin replied 1 year ago.

My apologies, but it's time for me to go to bed. I'll have an opportunity to answer any followup questions in about 6 hours, but my access will be intermittent after that point.

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