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Originally Posted by squiggs96
Why are you calculating the amount of taxes on a percentage of your principal paid? The formula for net rental income is to take all of your rents collected and subtract all of your expenses.
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I have always been instructed that the principal paid on the mortgage is considered profit and gets added to the net income from the rental at the end of the year. This is the number i have always been taxed on.
Quote:
Originally Posted by squiggs96
I can't tell from your scenario whether this is a stand alone property, like a condo
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Its a townhouse in a condo corp
Quote:
Originally Posted by squiggs96
You cannot take CCA to give you a rental loss.
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They added my personal return to the rental return. I would have a refund of $8400 without the CCA and $10,000 with the CCA. The rental was quoted around $600 owed in taxes so what else what else would explain the difference in amount?
Quote:
Originally Posted by squiggs96
This is not correct anywhere. You can take depreciation for accounting purposes, but it is based on the useful life of the asset, not based on how the mortgage is calculated.
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This could have just been me not understanding but how is the useful life of a rental property determined?
Quote:
Originally Posted by squiggs96
As stated above, you can't create a loss, which then gives you a refund on rental properties. Based on your figures, you can either pay taxes of $600, or reduce that amount to zero by taking CCA. You don't have to take all the CCA if you don't want to. You don't have to take any. That amount is optional from zero up until your net rental income before CCA
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I am supposed to meet with their accountant tomorrow to discuss this. This was all second hand for the people doing the taxes but it didn't make sense to me at the time
I will listen to recommendations if you know a good tax accountant haha