What is the principal residence exemption, and how does it benefit Alberta homeowners selling their primary home?
Correct Answer
C) It exempts the home's capital gain from income tax, if it qualifies and is designated for every year owned
The principal residence exemption under the Income Tax Act allows Canadian homeowners, including Albertans, to sell their primary home without paying capital gains tax on the profit. The property must be designated as the principal residence for each year of ownership. Only one property per family can be designated as a principal residence for any given year.
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