Moving to Canada and selling a US investment property

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kbwoods
Posts: 1
Joined: Tue Jun 11, 2019 8:38 pm

Moving to Canada and selling a US investment property

Post by kbwoods »

Hi There,

My husband and I are Canadians and we are greencard holders in the US. We have a rental property that we are looking to sell. We are also looking at making a move back to Canada. I am trying to understand if/when there are additional taxes (beyond normal capitol gains) on the sale of a US investment property - I am under the impression that we'll get hit with a big bill if we sell after moving to Canada, is that true? Is there anything we can do (aside from bending over backwards to make the sale happen sooner) to improve that situation?

Thanks,
kbwoods
Moving2Canada
Posts: 20
Joined: Thu Jun 25, 2015 12:58 pm

Re: Moving to Canada and selling a US investment property

Post by Moving2Canada »

I have a similar question, though in my case we have the option to sell our primary US residence before moving to Canada or to make it a rental property and sell it at some point in the future.

Canadian citizens. Is it better to hasten a sale (as a primary residence)? Assume economics of capital gains/rental income we are indifferent.
tchains
Posts: 14
Joined: Mon May 07, 2018 4:58 pm

Re: Moving to Canada and selling a US investment property

Post by tchains »

AFAIK, when you sell in Canada, you will be hit with cap gains by IRS on total gain, as well as gain of the house from the point you entered Canada to the sale. Cap gains are lower in US, so IRS takes their share then CRA tops up, via the tax treaty. So in general, yes better to sell before moving unless you're planning to hold a very long time (and assume the real estate appreciates).
tchains
Posts: 14
Joined: Mon May 07, 2018 4:58 pm

Re: Moving to Canada and selling a US investment property

Post by tchains »

Should also add that depreciation/CCA is treated a bit differently in US/Canada which affects cap gains
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