Principle Residence

Steeleb · Post by **Steeleb** » Thu Nov 10, 2016 7:22 pm

We own a condo in Ontario and one in Florida. We will be looking at selling our condo in Florida in the near future. The condo in Ottawa has not really increased in value. We have lived there for 8 years. The condo in Florida has increased from $200,000 to around $350,000 in 6 years. When we purchased the Canadian dollar was high and now low. Is it possible to make our Florida condo our principle residence and avoid paying capital gains in Canada. If not what would be the best way to avoid taxes.

Thank you for your help in this matter.

nelsona · Post by **nelsona** » Fri Nov 11, 2016 10:05 am

For Canada, CRA has definite guidelines on which property you can designate as your principal residence (PR), and I'd suggest you look thoise over on their website, however, there is nothing that prevents a home outside Canada from being so designated.

Realize that if you are able to designate the Condo and choose to do so, you will not beable to claim your other home as a PR for those years.

IRS too, has rules on what allows you to exclude gains on the sale of a home. You will need to meet these rules too, if you are going to avoid any tax. It is unlikely that you will be able to satisfy both sets of criteria.

The amount of Cdn tax would be based on the bbuying and selling price in C$ at the time the expenses and the proceeds are incurred, so your gain in C$ may not be that great.

nelsona · Post by **nelsona** » Fri Nov 11, 2016 10:09 am

https://www.irs.gov/uac/irs-issues-home ... sion-rules

http://www.cra-arc.gc.ca/tx/tchncl/ncmt ... tml#N1030C