Feds Increase Capital Gains Inclusion Rate

April 17, 2024 | Feds Increase Capital Gains Inclusion Rate

Danielle Park

Portfolio Manager and President of Venable Park Investment Counsel (www.venablepark.com) Ms Park is a financial analyst, attorney, finance author and regular guest on North American media. She is also the author of the best-selling myth-busting book "Juggling Dynamite: An insider's wisdom on money management, markets and wealth that lasts," and a popular daily financial blog: www.jugglingdynamite.com

The new Federal Budget released yesterday has significant implications for capital assets held by individuals and corporations. See: Feds raise capital gains inclusion rate to 66.6% starting June 25.

The taxable portion increases to two-thirds from one-half on capital gains above $250,000 realized annually by individuals and all capital gains realized by corporations and trusts.

This will undoubtedly incentivize some asset sales before June 25 and prompt consideration of whether some capital assets, like real estate and equities presently held in corporations, can be transferred to individual owners for greater tax efficiency. Accountants will be busy.

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