Lifetime capital gains deduction

The capital gains deduction can be claimed with respect to three types of property: qualified small business corporation shares (see topic 136), qualified farm property (see topic 137) and qualified fishing property (see topic 138).

$100,000 capital gains deduction

The $100,000 capital gains deduction for other capital property (other than the three types listed above) was eliminated on February 22, 1994. At this time, everyone was permitted to make a special one-time-only capital gains election. In most cases, this election had to be made on your 1994 tax return. The election allowed you to opt to have a deemed disposition of any capital property you owned on February 22, 1994, at any amount up to its fair market value on that day.

In most cases, the amount you elected as a deemed disposition became your new cost base. The election was made by filing Form T664 with your 1994 income tax return.

Tax tip: If you still own property for which a capital gains election was made, you should continue to monitor the revised cost base to ensure it’s taken into consideration on a subsequent sale of the property.