My aunt is currently renting a room with my mother below the average market cost of rent. When my mother fills out her T776 this year, she will get a rental loss. We are getting a rental loss this year because the aunt is the only remaining tenant compared to previous years.
We recently became aware of CRA's interpretation of cost-sharing agreements where you do not need to fill out a rental income form for families.
Do I continue to fill out the T776 and state this would be the last year of rental operations or should I just not include the form this year.
Hi
You have good information. CRA does not want people to rent at less than Fair Market Value, especially to family, in order to claim a loss. Rental income is intended to show profits at some point. If your Mother is no longer going to be advertising or seeking additional tenants, then she should not claim the income & expenses.
Hi
You have good information. CRA does not want people to rent at less than Fair Market Value, especially to family, in order to claim a loss. Rental income is intended to show profits at some point. If your Mother is no longer going to be advertising or seeking additional tenants, then she should not claim the income & expenses.
Thank you Christine for your fast reply! How important is it to fill out the question on the T776: "Was this your final year of rental operation?". Would I need to amend last year's return for this question to yes?