Canada Tax Questions Answered by Experts
As per the ITA §44 or §44.1, a taxpayer may defer gain on a sale by rolling into a replacement property, provided the existing property was stolen, expropriated by government, or destroyed, and/or used by the taxpayer to generate income (excluding rental income) from a business.
The seller should acquire another property in place of the disposed property within a certain time period. This should be similar to the disposed property, or used for the same purpose in order to qualify for the tax deferral of the gain (by reducing the tax cost of the replacement property) realized on the former property.
The Canada rules are not similar to the US 1031.
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