Hi there, I have a tax question, which happen a lot in everyday life:
here the situation:
two siblings bought a condo together, and live in it together (their principle residence), and land title have both of their name. Few years after, one of the sibling get married (say sib1), and move out of the condo and live with spouse, at another house, which is the spouses principle residence. The other sibling (sib2) live in the condo the siblings bought together. After sib1 move out, they have an agreement that since sib1 no longer stay at the condo, sib2 will pay for all the expenses incur for the condo, eg, mortgage, repairs, etc. However, sib1 name wasn’t remove from the condo land title. Now sib2 sold the condo they original bought together, and the proceed 100% go to sib2, as sib2 is the one that pay for everything. As the condo is sib2 principle residence, there is no tax consequences, but need to be reported. The question is, is there tax consequences for sib1, because sib1 own the other half share according to the land title. But in reality, sib1 have nothing to do with the condo anymore every since sib1 moved out, in other word just legal ownership. Is there any capital gain for sib1? If there is, then need to fill out the T2091, and calculate the gain, right? If there no gain, what kind of document will be needed to proof that sib1 only legal ownership?