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Capital Losses and Tax Return Questionnaire
— Courtney sells a cottage at the lake that the family had used for their summer vacations in November 2020. The purchaser paid Courtney $100,000 and assumed the mortgage which had a principal balance of $50,000. Courtney had purchased the cottage in January 2014 for $170,000. Courtney will realize and recognize a ($20,000) loss on her tax return.
True or False
— Individuals can deduct capital losses to the extent of capital gains plus $3,000. Corporations can only deduct capital losses to the extent of capital gains. However, both corporations and individuals can carryforward capital losses indefinitely.
True or False
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