The Capital Gains Blog

Archive for the ‘Capital Gains on Sales’ Category

Question: What is the tax treatment of an installment sale in Canada?

Does Canada allow taxpayers to defer a portion of their capital gain when an asset is sold through an installment sale? If so, please tell me what government regulations I can look at that speak to this point. I need to find out the mechanics of how this type of sale is treated under Canadian law. Thanks!

Answer: The provision you are looking for is subparagraph 40(1)(a)(iii) of the Income Tax Act.

It is a reserve. It usually works out to a maximum reserve of 80 percent in the year of disposition, 60%, the year following, 40%, 20%, and NIL There are also some limitations with respect to the amount still remaining unpaid (you can’t just defer the amount each year if you’ve been paid in full)..

First Cash Raises 2009 Continuing Ops Earnings Guidance by $0.05; Pays Off Credit Facility With Proceeds From Sale of …

ARLINGTON, Texas — First Cash Financial Services, Inc. today announced that it is raising fiscal 2009 guidance for earnings from continuing operations by $0.05 per share. The increase is the result of stronger than expected fourth quarter revenue and operating results from the Company’s pawn operations, both in the U.S. and Mexico.

Question: Do I have to pay capital gains on the sale of my FIRST house?

I am selling it before the 2 year exemption period

Answer: There’s nothing special about a first home.

If you sell before the 2 year period, you’ll pay Capital Gains Tax. If you own it for a year or less, it will be at your regular rate, otherwise will be a maximum of 15%. This is on the gain, not on the whole sales price.

(AFX UK Focus) 2010-01-06 01:31 Nikkei edges higher; eyes on JAL and finmin Fujii

By Elaine Lies

How To Sell Your Home Without A Capital Gain Tax

Question: Can I deduct a loss on the sale of my personal home against a gain on the sale of rental property?

I sold my home in 2006 that I bought in 1999 and qualifies as my personal residence. (lived in it 3 of the last 5 yrs).The basis in this property is less than the proceeds resulting in a loss. Personal losses are not deductible.

I sold rental property in 2006 resulting in a long term capital gain.

Can I reduce the amount of my long term gain by the amount of the loss on the sale of my principal residence?

Answer: No, you can never take a deduction for a loss on the sale of a personal residence, even to offset the gain on the sale of a rental property.

Had you converted your personal residence to a rental unit you could have used that loss to offset the gain on the other rental. If the loss was enough to wipe out the gain on the sale of the rental, some of the additional loss could have been claimed against your other income with the balance of the loss carried forward to future tax years.

An even better approach (if feasible for you) might have been to move in to the rental for 2 years and rent out your former principal residence and then sell them both. You’d have a recapture of the depreciation claimed on the former rental but that probably would not have been enough to put you over the exclusion amount on the sale of a principal residence and you might have been able to take at least a partial loss on the sale of your former principal residence. Even if you couldn’t take the entire loss in the year of the sale you usually can carry forward the loss to future tax years.

Unfortunately it’s now too late for either of those tax-saving options.

Tax Season: Now’s the Time to Get to Planning

December 20, 2009 (Tulsa World, Okla.) As if you weren’t already rushed enough with last-minute holiday shopping and general year-end busyness, here’s a little something extra to throw into the mix — tax planning.

Selling2PrimaryHomes.mp4

Question: capital gains taxes on stock sales?

Im new to stocks and trying to understand something. Lets say I own 1000 shares of stock each in two different companies and both stocks are valued at $100/share. If one company gains 50% (for a profit of $50,000) and the other company im invested in loses 50% (for a loss of $50,000) and I sell both, do i still owe capital gains taxes on the stock I profited on or does the Capital Loss from the second stock cancel out the gains for the year.
OK, Thanks for the answers. I read im only allowed up to $3000 in capital loses each year, and I didnt know it that meant total allowed for the year or above and beyond covering gains with losses.

Answer: You net your losses and gains together, and only pay tax on the net gain. It’s really a little more complicated, since there are different rules for stocks held for at least a year and a day than for sales of stocks held for a shorter time.

If you have a net gain for the year, you pay tax on the net gain. If you have a net loss, you can offset $3000 of your other income with the loss, and if your net loss is over $3000 you carry the extra loss over to the next year.

Computation of Capital Gain

When a nonresident enterprise transfers equity interest in a Chinese resident enterprise, the nonresident enterprise generally should be liable for China’s corporate income tax at 10 percent of the gain, if any, derived from the transfer.

C-Corp Asset vs. Stock Sale Dilemma

Question: sale of a business, tax questions?

If I recently sold my business for 10,000, completely intangible, no inventory included. What are the tax implications, is it capital gains or ordinary income? Whart form and line, (or box), do I put this in. And likewise where does the buyer expense this purchase.

The business was a simple partnership between two people, no LLC or anything complex, and was in business for 3 years. The former partner bought out the business and is running it as a sole proprietership.
I want to reiterate that this particular aspect of the sale, was not from any asset that was purchased or monetary investment made. It was for intangibles, like the right to do business in a certain area without competition, business contacts, company name, expected sales from location etc.

The reason Im asking because im getting different answers from accountants, and not one is competent enough to give me a straight forward answer on this,

Answer: The sale would be reported on Form 4797 for sale of business property. You would need to know your cost basis before calculating your gain/loss. Assuming you had a gain, it would be long-term capital gain and it would flow from Form 4797 to Schedule D, Part II, line 11.

An interest in a partnership or joint venture is treated as a capital asset when sold.

GE Capital Leads Second-Biggest Day of Debt Issuance (Update1)

Jan. 5 (Bloomberg) — General Electric Capital Corp. and a unit of Lloyds Banking Group Plc led U.S. corporate bond offerings of at least $23.2 billion, the second-biggest day ever, according to data compiled by Bloomberg.

The ATO should be renamed The Fun Police