Several years ago I acquired some real estate as part of a settlement in a law suit. I've just sold this real estate. As I understand it, the proceeds of a law suit are not taxable income. But what I'm not sure about is if the proceeds from the law suit would differ from the value of the sale of the real estate (in other words, is there an adjusted cost base?). Would the value of the tax-free amount be determined:
When the real estate is sold?
Or when it was acquired?
If when it was acuired (which was some time ago), how would that value be established if no appraisal was done at the time?