I'm assuming that the Fair Market Value is the proceeds of disposition while filling out the details in turbo tax. Any help is appreciated
There are special rules to consider when you convert your Principal Residence to a rental property.
When the property use changes from personal-use to income-producing, the deemed disposition can result in a Capital Gain. Any gain resulting from this deemed disposition may be eliminated by the principal residence exemption (PRE) if the property has always been the taxpayer's principal residence.
The following CRA information describes this election in greater detail:
As for determining the Fair Market Value (FMV), you can use the Property Assessment, compare like properties in that area, or (the most accurate way and CRA accepted), have an actual "Property Appraisal" done.
There are special rules to consider when you convert your Principal Residence to a rental property.
When the property use changes from personal-use to income-producing, the deemed disposition can result in a Capital Gain. Any gain resulting from this deemed disposition may be eliminated by the principal residence exemption (PRE) if the property has always been the taxpayer's principal residence.
The following CRA information describes this election in greater detail:
As for determining the Fair Market Value (FMV), you can use the Property Assessment, compare like properties in that area, or (the most accurate way and CRA accepted), have an actual "Property Appraisal" done.
Hi,
Rather than linking the cra site, can you please tell us how to actually do a deemed disposition on the turbo tax software. Which parts do we need to fill out? “Sale of principal residence” mentions that we need to fill it out if there is a deem disposition. Is there anything else? Maybe schedule 3 for capital gains and losses? Please let me know!
You would need to fill out the Principal Residence form, with any info that is relevant to your situation.
If you do have a capital gain, then Schedule 3 will automatically be filled out based on what you entered on the Principal Residence form
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