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Legal Ease
Legal Ease, Lawyer
Category: Canada Tax
Satisfied Customers: 100032
Experience:  Lawyer
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And it is about capital gains when selling a cottage

Customer Question

***** ***** and it is about capital gains when selling a cottage My husband and I sold our cottage this year. We owned it as tenants in common. I put the downpayment down and we paid the rest together. So with the dow npayment I own 64% of the cottage and he 36%. When doing income tax, I can't figure out how to split teh capital gain
JA: Thanks. Can you give me any more details about your issue?
Customer: I do not know how to split the cost and capital gain between him and I in schedule 3 to reflect that I own 64% of it based on the fact that I out the downpayment
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Submitted: 1 year ago.
Category: Canada Tax
Expert:  Legal Ease replied 1 year ago.
Thank you for requesting me. The fact that you paid the down payment is what gives you a greater share of the cottage. So it is no longer considered. Rather, you would take the sale price less the purchase price less any capital improvements and that is the capital gain. Then you get 64% of the capital gain and he gets 36% of the capital gain and so then one half of your share goes into your income for tax purposes and one half of his share goes into his income for tax purposes.Does that help?
Customer: replied 1 year ago.
My question is how do I show it in schedule 3. I guess I just put my 64% share of the cottage sale price, capital improvements and purchase price on mine and 36% of the same in his schedule 3?
Expert:  Legal Ease replied 1 year ago.
Yes that is correct.
Customer: replied 1 year ago.
Expert:  Legal Ease replied 1 year ago.
You are very welcome.