TaxCycle | Products | Pricing | Training | Documentation | Support | News

Principal Residence

Client had their house taken due to insolvency. It was not sold. Do I report it on Schedule 3 as disposed? I think i would for the value that it was deemed worth on the debt schedule?
Thanks in advance for your input.

Are you asking what to put for “Proceeds of disposition”? Assuming this was a principal residence, it shoudn’t really matter unless some portion of it was not eligible for the PRE. I agree with you - the most reasonable value for POD is the mortgage balance owing (including any penalties, etc). However, I would first ask whether your client intends to fight the bank for it. If they expect to get the house back, then obviously it should not be reported as “disposed”.

1 Like