ACTG 3P41 Lecture Notes - Lecture 2: Capital Gain, Deferral
24 Jan 2016
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In order to be eligible we must replace the building or land we are giving up in: 24 month if involuntary, 12 month if voluntary it. We go by the end of the year regardless when we sell. The election calculation is as followed: lesser of: proceeds (acb+ selling costs) = capital gain, once chosen: cost of purchase the chosen lessor = new. Make sure this election start when we assume the proceeds are. If 0 for 2nd lessor then just use capital gain. Recapture on buildings to do a recapture calculation: The capital gain and recapture must be reported in year of sale: there are two parts to this calculation first is when we are, first part is as followed we: Ucc before disposal selling the asset the second part is the replacement: Ending ucc xxx calculation: lesser of: (xxx) When selling both land and building together ! Building xxx xxx: the calculation is as followed:
