Capital Gains and Losses 2023

New Proposed Inclusion Rate

The federal government has proposed an increase in the inclusion rate from 50 to 66.67% on capital gains. This means that when you sell your home or other capital assets, the majority of the profit will be included in your taxable income.

Calculating Capital Gains and Losses

To calculate any capital gain or loss, you need to know the following three amounts:

• Your original cost or adjusted cost basis of the asset
• The amount you received when you sold the asset
• Any expenses associated with the sale of the asset

Capital Gain or Loss on Sale of Home

When you sell your home, you may realize a capital gain. This gain is the difference between the sale price of your home and your adjusted cost basis. Your adjusted cost basis is your original cost of the home plus any improvements you have made to it. If you have lived in your home as your principal residence for at least two of the past five years, you may be eligible for a capital gains exclusion.