# Capital Gains when gifting Real Estate **URL:** \ **Category:** Tax Topics\ **Created:** [March 11, 2024, 6:28pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006 "2024-03-11T18:28:25Z")\ **Posts on this page:** 13\ **Page:** 1
**Author:** ![beagon](https://avatars.discourse-cdn.com/v4/letter/b/ac8455/32.png) [@beagon](https://www.protaxcommunity.com/u/beagon)\ **Post date:** [March 11, 2024, 6:28pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/1 "2024-03-11T18:28:25Z")
I have a client who inherited a condo in Florida jointly with his sister. Two years later, he gifted his share to his sister. Does he report the Capital Gain using FMV on inheriting it and FMV as of the date of the gift? ---
**Author:** ![Nezzer](https://sea2.discourse-cdn.com/flex016/user_avatar/www.protaxcommunity.com/nezzer/32/3845_2.png) [@Nezzer](https://www.protaxcommunity.com/u/Nezzer)\ **Post date:** [March 11, 2024, 7:01pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/2 "2024-03-11T19:01:16Z")
Yes. Tax on the gain in equivalent Canadian dollars (unless it was his principal residence for any of that time). But, don’t forget to fill out the T1135 if applicable. ---
**Author:** ![benoit.associes1](https://avatars.discourse-cdn.com/v4/letter/b/858c86/32.png) [@benoit.associes1](https://www.protaxcommunity.com/u/benoit.associes1)\ **Post date:** [March 11, 2024, 7:57pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/3 "2024-03-11T19:57:20Z")
Transfers (gifts) made to related parties are considered to be made a market value regardless of the amount or lack thereof on the contract. The T1135 might not apply if is was personal and not a commercial (rented) property. ---
**Author:** ![Nezzer](https://sea2.discourse-cdn.com/flex016/user_avatar/www.protaxcommunity.com/nezzer/32/3845_2.png) [@Nezzer](https://www.protaxcommunity.com/u/Nezzer)\ **Post date:** [March 11, 2024, 8:31pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/4 "2024-03-11T20:31:08Z")
> [@benoit.associes1](#): > > T1135 might not apply if is was personal You have to report ownership of property with a FMV of $100,000+ CAD, regardless of rental income. ---
**Author:** ![beagon](https://avatars.discourse-cdn.com/v4/letter/b/ac8455/32.png) [@beagon](https://www.protaxcommunity.com/u/beagon)\ **Post date:** [March 11, 2024, 10:50pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/5 "2024-03-11T22:50:58Z")
Thank you! ---
**Author:** ![beagon](https://avatars.discourse-cdn.com/v4/letter/b/ac8455/32.png) [@beagon](https://www.protaxcommunity.com/u/beagon)\ **Post date:** [March 11, 2024, 10:51pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/6 "2024-03-11T22:51:52Z")
Thank you Nezzer! ---
**Author:** ![stuckinmydungeon](https://avatars.discourse-cdn.com/v4/letter/s/e274bd/32.png) [@stuckinmydungeon](https://www.protaxcommunity.com/u/stuckinmydungeon)\ **Post date:** [March 11, 2024, 11:12pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/7 "2024-03-11T23:12:55Z")
Not if it is personal use. ---
**Author:** ![Nezzer](https://sea2.discourse-cdn.com/flex016/user_avatar/www.protaxcommunity.com/nezzer/32/3845_2.png) [@Nezzer](https://www.protaxcommunity.com/u/Nezzer)\ **Post date:** [March 12, 2024, 12:49am UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/8 "2024-03-12T00:49:42Z")
Well. I just looked it up, and you are correct. Don’t I feel foolish. 😵‍💫 All these years, I’ve been filing T1135s to report clients’ personal use properties! Thanks for setting me straight @benoit.associes1 and @stuckinmydungeon I learned something today. ---
**Author:** ![kevin](https://avatars.discourse-cdn.com/v4/letter/k/2acd7d/32.png) [@kevin](https://www.protaxcommunity.com/u/kevin)\ **Post date:** [March 12, 2024, 12:16pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/9 "2024-03-12T12:16:29Z")
Actually, the T1135 is based on a _cost_ of $100,000 (Cdn$); not fair market value. ---
**Author:** ![stuckinmydungeon](https://avatars.discourse-cdn.com/v4/letter/s/e274bd/32.png) [@stuckinmydungeon](https://www.protaxcommunity.com/u/stuckinmydungeon)\ **Post date:** [April 17, 2024, 11:56pm UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/10 "2024-04-17T23:56:52Z")
we all learn something everyday. also, note to @kevin Kevin, the FMV is used on option 7 on the T1135 for assets in CAnadian brokerage account. ---
**Author:** ![kevin](https://avatars.discourse-cdn.com/v4/letter/k/2acd7d/32.png) [@kevin](https://www.protaxcommunity.com/u/kevin)\ **Post date:** [April 18, 2024, 12:47am UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/11 "2024-04-18T00:47:02Z")
What I was saying was that the requirement to file a T1135 is based on having $100K (Cdn$) COST of foreign investment assets, not $100K of FMV. ---
**Author:** ![stuckinmydungeon](https://avatars.discourse-cdn.com/v4/letter/s/e274bd/32.png) [@stuckinmydungeon](https://www.protaxcommunity.com/u/stuckinmydungeon)\ **Post date:** [April 18, 2024, 12:50am UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/12 "2024-04-18T00:50:11Z")
Hi Kevin, i was just pointing out on the post that category 7 required entry of the FMV of the assests held in a canadian brokerage account. It can catch some off guard if they enter the cost numbers. category 1-6 do enter the Cost. ---
**Author:** ![kevin](https://avatars.discourse-cdn.com/v4/letter/k/2acd7d/32.png) [@kevin](https://www.protaxcommunity.com/u/kevin)\ **Post date:** [April 18, 2024, 1:20am UTC](https://www.protaxcommunity.com/t/capital-gains-when-gifting-real-estate/8006/13 "2024-04-18T01:20:51Z")
Yes, that’s true.