Real Estate

Trudeau planning to tax gains on personal residence?

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  • Dec 11th, 2022 2:14 pm
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Jun 14, 2018
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taxrage wrote: Ferarri owners also pay maintenance and other expenses for that type of personal use property, but if one purchased for $300K in 1990 sells for $1.5M today, there's a taxable $1.2M capital gain.

A home is more of a necessity, hence a good reason for not taxing 100% of any capital gain.
Wouldn't this be a good reason to just not tax the capital gain then? Like you said, a home is a necessity, unlike everything else that is currently taxed.
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MarinersFanatik wrote: Wouldn't this be a good reason to just not tax the capital gain then? Like you said, a home is a necessity, unlike everything else that is currently taxed.
Well, you tell me. Any homes in Canada like the one Bill Gates just bought on Del Mar for $42M? https://imgur.com/gallery/l7POtbc

Is that PR on more than 0.5 hectares?

If it's sold in 10 years for $52M, should the $10M gain be tax-free? It's wouldn't be in the USA, so why in Canada?
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Jun 26, 2011
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taxrage wrote: Well, you tell me. Any homes in Canada like the one Bill Gates just bought on Del Mar for $42M? https://imgur.com/gallery/l7POtbc

Is that PR on more than 0.5 hectares?

If it's sold in 10 years for $52M, should the $10M gain be tax-free? It's wouldn't be in the USA, so why in Canada?

That's a really poor argument
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Mar 2, 2017
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This was the proposal circulated a while back:

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Jun 26, 2011
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RichmondCA wrote: This was the proposal circulated a while back:

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The fact that they have a tax on 5+ years at all shows its not just about punishing flippers and speculators

Also, there are many people who have to sell earlier than expected due to job loss/changes, family deaths/births/divorce, etc. There would be a ton of people unfairly punished in that system

To be it's just another example of Trudeau wanting his hand in your pocket. More money to mis-manage and give away
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taxrage wrote: Well, you tell me. Any homes in Canada like the one Bill Gates just bought on Del Mar for $42M? https://imgur.com/gallery/l7POtbc

Is that PR on more than 0.5 hectares?

If it's sold in 10 years for $52M, should the $10M gain be tax-free? It's wouldn't be in the USA, so why in Canada?
So we should follow everything that the USA does? Come up with a better argument.
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MarinersFanatik wrote: So we should follow everything that the USA does? Come up with a better argument.
It's one of the ways the USA attempts prevent extreme concentration of wealth. They either tax you while your alive with taxes such as capital gains on the sale of a home, or when you die with taxes such as the estate tax. Just ask Prince.

It's one of the few things we can learn w.r.t. wealth concentration in the USA. That said, they get a lot of other things wrong, such as the way they fund public schools.
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May 9, 2017
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taxrage wrote: It's one of the ways the USA attempts prevent extreme concentration of wealth. They either tax you while your alive with taxes such as capital gains on the sale of a home, or when you die with taxes such as the estate tax. Just ask Prince.

It's one of the few things we can learn w.r.t. wealth concentration in the USA. That said, they get a lot of other things wrong, such as the way they fund public schools.
Nice try. Inequality is worse in the US.
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NotRobot wrote: Nice try. Inequality is worse in the US.
Yes, I know. That's why I said they get a lot of other things wrong.

They probably figured the wealth class had to give up something, hence the capital gains tax on the sale of a home. Sorry Bill Gates. The next $10M you make on your PR will be taxable.
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taxrage wrote: It's one of the ways the USA attempts prevent extreme concentration of wealth. They either tax you while your alive with taxes such as capital gains on the sale of a home, or when you die with taxes such as the estate tax. Just ask Prince.

It's one of the few things we can learn w.r.t. wealth concentration in the USA. That said, they get a lot of other things wrong, such as the way they fund public schools.
What's wrong with the way it currently is in Canada? Why should I (and other middle-class Canadians) care that the top 1,5 or 10% take a larger hit on gains from their family homes?
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MarinersFanatik wrote: What's wrong with the way it currently is in Canada? Why should I (and other middle-class Canadians) care that the top 1,5 or 10% take a larger hit on gains from their family homes?
The biggest problem with it is that, the more wealth you have, the more you can leverage the tax-free treatment of the capital gain on a PR.

No other area of the tax system works this way. There are limits on TFSA and RRSP contributions, limits on the capital gains exemption on shares in a small business or farm property. Even the very generous pension-splitting feature maxes out at roughly $30K/yr in tax savings.

Yet, if you have $10M and want to maximize the amount of tax-free income you can earn with that, you can plunk $5M down on a very nice west coast property and live there for a few years and maybe walk away with another $2M tax-free.

A relative of mine moved to Vancouver a few years ago. They bought a house for $800K and I think sold it for $1.1M two years later. A nice, quick $300K tax-free profit. I'm not saying we necessarily should tax a $300K profit, but there needs to be some kind of limit, just as there is in every other aspect of the tax system when it comes to things being tax-exempt.
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Jan 12, 2017
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Lets be honest, with the posted tiered proposal, any of the wealthy will be taxed at no more than the 5% rate.... many homes go up that much in a year. Big deal.

The biggest losers are going to be the middle and working classes. Those moving for work and those people who need to start off in a condo and progressively upgrade their homes to accommodate children are going to lose at least 5% on top of all other taxes, probably more, especially since house prices in urban areas have been going up faster than the proposed tax tiers down.

If you own multiple (non-condo) properties in the GTA, you're definitely not middle class.
MarinersFanatik wrote: What's wrong with the way it currently is in Canada? Why should I (and other middle-class Canadians) care that the top 1,5 or 10% take a larger hit on gains from their family homes?
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May 31, 2017
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taxrage wrote: Well, you tell me. Any homes in Canada like the one Bill Gates just bought on Del Mar for $42M? https://imgur.com/gallery/l7POtbc

Is that PR on more than 0.5 hectares?

If it's sold in 10 years for $52M, should the $10M gain be tax-free? It's wouldn't be in the USA, so why in Canada?
I'm still waiting for the examples of the $2.5M homes that someone bought 3 years ago in Richmond Hill that you think just sold for $4M...you keep throwing out these VERY RARE and outrageous examples that would have a very negligible tax benefit for the country. You don't create a tax system that impacts almost all homeowners just to target these outliers.

You also continue to ignore that someone who bought a home 15 years ago in the GTA for say $400K, paid all/most of it off, and then sold it today for around $1.2M. You want them to pay some hefty tax on it. Meanwhile that poor family is, again for a TYPICAL example, is just moving to Aurora or Markham and is buying a new home for $1.2M (that was also probably $400K 15 years ago). Because of this tax that family would now have to go get another sizable mortgage to cover the equity they lost to taxes...just to live in a similar sized home. You IGNORE that you always buy and sell a primary residence within the market dynamics of the day...it makes no sense to tax a PR for this reason. Eventually, the homeowners DIE and the government taxes their estate...you don't tax them repeatedly every time they buy/sell their PR.
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BatCountry wrote: I'm still waiting for the examples of the $2.5M homes that someone bought 3 years ago in Richmond Hill that you think just sold for $4M...you keep throwing out these VERY RARE and outrageous examples that would have a very negligible tax benefit for the country. You don't create a tax system that impacts almost all homeowners just to target these outliers.

You also continue to ignore that someone who bought a home 15 years ago in the GTA for say $400K, paid all/most of it off, and then sold it today for around $1.2M. You want them to pay some hefty tax on it. Meanwhile that poor family is, again for a TYPICAL example, is just moving to Aurora or Markham and is buying a new home for $1.2M (that was also probably $400K 15 years ago). Because of this tax that family would now have to go get another sizable mortgage to cover the equity they lost to taxes...just to live in a similar sized home. You IGNORE that you always buy and sell a primary residence within the market dynamics of the day...it makes no sense to tax a PR for this reason. Eventually, the homeowners DIE and the government taxes their estate...you don't tax them repeatedly every time they buy/sell their PR.
First, there is no estate tax in Canada, only probate fees. The USA, OTOH, has estate taxes. The hit to the Prince estate was $400M. George Steinbrenner lucked out, but maybe not his heirs: https://www.forbes.com/2010/07/20/yanke ... 6e21c8180e

I have not addressed whether tax would be deferred upon the purchase of another PR of equal/higher value, so there's no point jumping up and down about how move-up buyers would be hit by a capital gains tax. Perhaps, as in the Steinbrenner example, they would just not take advantage of any step-up value.

Any such tax would have to accomodate move-up buyers and all buyers up to some exemption limit. If it doesn't prevent you from moving up, and each spouse get some kind of exemption every few years, then I really don't see people arguing that their $1M gain on a luxury home in Vancouver must be completely hands off from a tax point of view. It's income.
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Jul 18, 2020
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Guys, the best is to report this tread so that the mod will close it, keep responding to this thread will just feed the troll.
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lechan wrote: Guys, the best is to report this tread so that the mod will close it, keep responding to this thread will just feed the troll.
We don't shut down discussion in Canada. Maybe I should report you.
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Jul 18, 2020
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taxrage wrote: We don't shut down discussion in Canada. Maybe I should report you.
You are sitting at -23 downvotes 3 upvotes, all you need is a few more downvotes for the mod to lock it. Even if I don't report you, I am sure others will, just watch.
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lechan wrote: You are sitting at -23 downvotes 3 upvotes, all you need is a few more downvotes for the mod to lock it. Even if I don't report you, I am sure others will, just watch.
Be sure to give me a ring then. BTW, sometimes downvotes are a good thing. Check out this downvoted thread that went 131 pages. Maybe you should report it: trudeau-going-after-personal-services-c ... 74132/131/
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Jul 18, 2020
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taxrage wrote: Be sure to give me a ring then. BTW, sometimes downvotes are a good thing. Check out this downvoted thread that went 131 pages. Maybe you should report it: trudeau-going-after-personal-services-c ... 74132/131/
That one you quoted has 29 up and 34 down pretty close to 50/50 argument, this thread that you create has 3 up and 24 downvote, I don't understand how you can equate the 2. This is exactly like the argument that you made in this thread, keep on exaggerating om the 10M tax free gain from the elite upper, while majority of the people in here don't even own more than a 2M + property.
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Taxrage I have still not seen a viable solution from you on this:

1) How would you implement this?
2) What's the cap? What's the tax rate? What if I want to move from one property to another?
3) And how would you be able to implement this and ever think of winning political office again? And not withstanding the other party would run on a campaign to eliminate the cap gains tax.

You would be losing in every which way to implement this but i want to know how you would implement this...

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