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Dragonrana

T2091 - Principal Residence Exemption

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Hi,

 

I am currently doing my taxes for my spouse, and we wanted to know how she can enter the principal residence exemption on a townhouse she had purchased with her brother 9 years ago, and sold it last year. She lived there for 6 years as her permanent residence. i can't find anything in Ufile to enter this information. Also, would we have to submit the T2091 form with our tax return by mail to CRA?

 

i hope someone can answer my question.

 

Thanks,

Brian

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The program does not support the forms for designation of a property as a principal residence because they are required for information purposes only.
 

Therefore, you must download them from their respective government websites, print them, complete them, and file them by mail.
 

1- For form T2091 - Federal:

http://www.cra-arc.gc.ca/E/pbg/tf/t2091_ind/
 

Worksheet - Federal:

http://www.cra-arc.gc.ca/E/pbg/tf/t2091_ind_-ws/
 

2- For form TP-274 - Quebec:

http://www.revenuquebec.ca/en/sepf/formulaires/tp/tp-274.aspx
 

You must complete and file these forms with their respective governments by mail. The CRA and Revenu Québec will take these forms into account when determining the principal residence.

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Hi,

 

So, when i file my taxes and my spouse's taxes i indicate the capital gains from the selling of the townhouse, then I netfile it, and then i mail the worksheet and T2091 form.  

With the capital gain from selling, my wife will be hit with a large amount to pay to the government. If she pays the large amount, and the government says she is exempt 7 (6+1) years out of the 9 years, does that mean the government will cut her a cheque for the difference that she overpaid in her taxes?

 

Please advise.

Thanks,

Brian

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Let me back track....in 2004 she and her brother purchased a townhouse so that her parents, her, and the brother could live together. in 2011 she married me and moved in with me. in 2013 my wife and her brother sold the townhouse. Because she lived there from 2004 to 2010, her capital gains should be exempt for those years, since it was her principal residence. The only capital gain that she should be accounting for should be from 2011 to 2013. That is why the principal residence exempt formula applies to her situation. I still find it weird that Ufile does not have this in their program.

 

The principal residence exemption calculation is:

(# of years home is principal residence + 1)  x capital gain
# of years home is owned

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The calculation should be part of the T2091 form.

The end result on line 53 is the capital gain your wife would need to report under "Personal property".

 

Note that you need to increase the gain by $1,000 because a default adjusted cost base of $1,000 is applied.

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I am filing out the Principal residence worksheet T2091(IND) WS E form and it really doesn't make much sense. Why would I need to know the fair market value at the end of Feb 22, 1994, if my spouse purchased the townhouse in 2004? This worksheet seems so dated and useless. Nothing really applies here, but somehow the T2091 - "Designation of a property as a principal residence by an Individual: form requires in Part 4 for the "Reduction as a result of the capital gains election"??? I find the worksheet absoultely useless and does not apply in my circumstance. Gabriel can you help out here?

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