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By: Adrian Mastracci
Contributing Writer
North Shore News
Business Section, “Ask Money Questions”
Sunday, March 30, 2003
Question: How does my 1994 election for the
$100,000 lifetime capital gain exemption affect
my 2002
tax return?
Answer: Revisiting your 1994 income tax filing
for the special election made to use all or
part
of the $100,000 capital gains exemption is
beneficial. That election increased the tax
cost (ACB) of investments that you owned on
February 22, 1994, such as stocks, bonds, mutual
funds and partnerships.
If you sold any of those investments during
2002, check your 1994 ACB elections on them.
Be extra careful reporting taxable amounts
from mutual funds that were included in the
1994 exemption.
The elected ACB from 1994 reduces your 2002
taxable capital gains or increases the loss.
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