When entering capitol gains information for the sale of a rental property with my spouse, do I split the proceeds? sale was 157,400 would I enter 78,700 each?

The answer to the question of whether or not you can split your capital gain with your spouse depends on whether or not you shared in the purchase of the investment in the first place and how much your spouse contributed.

 

You can’t just split a capital gain 50/50 with your spouse.

 

This is because of the Attribution Rules, tax rules which have been specially created to limit income splitting (shifting income from a family member with a higher income to a family member with a lower income to reduce the overall tax a family has to pay).

 

For Example:

if you bought 200 shares of stock and then sold them, realizing a capital gain, all of the capital gain would have to be declared on your income tax because you are the one and only person who paid for the stock.

 

If, on the other hand, you and your spouse bought 200 shares of stock, and you paid 75 percent of the purchase price while your spouse paid 25 percent of the purchase price, you would declare 75 percent of the capital gain on your income tax and your spouse would claim the other 25 percent.

 

For more information please check: Can I Split My Capital Gain With My Spouse?

 

If you need any further clarifications, we would be glad to assist you by having you contact us by phone or via Facebook or  Twitter.