While the weather makes it seem like January, it really is the time of year we all anticipate with glee or trepidation — time to file your 2017 Income Tax Return! I want to remind you that in accordance with a provision introduced in 2016, you must report the sale of your principal residence in the year of the sale.
If you forget to report the sale of your principal residence, you may incur a penalty on your income tax return for the year you sold it, of up an amount up to $8,000.00. You also may be assessed and taxed on the net profit as a capital tax. To qualify as a principal residence for the length of time you owned it, the dwelling had to be occupied by yourself, your spouse, a common-law partner, or a child minimally for some time period of each year of ownership. The definition of a principal residence includes not only a single family dwelling but also includes a unit in a Condominium, Co-Ownership or Co-Operative building, a trailer, a houseboat or mobile home.
Remember, you do not want to have to pay a fine for being forgetful – you also want to avoid raising a red flag which may result in a C.R.A. audit!
