How do you calculate ACB for your rental property? Is this the same as FMV (fair market value) – at time of starting to rent the unit?

Any links to help on this would be appreciated!

[...] of these conditions allow you to claim a capital loss. If the shares ever regain value again, the adjusted cost base (ACB) is $0 and you will have a capital gain when you actually sell [...]

ACB = (Total Cost + Commissions)/Total Number of Shares Owned

do they simply increase the TNSO (total number of shares owned) ??

Hey Guys,

I am on a fee base structure @ CIBC – so each year a pay about 1.25% of my portfolio value. This basically includes a bunch of trades and etc.. Anyways,
my question is: How do you write off the fee on a tax form? Let’s say it cost me $X dollars in trade fees which form do I declare that on? Any tax experts and/or anyone in a similar situation? Any help would be greaaat!

I see three options:
1) convert each transaction into CAD using the spot exchange rate.
then compute ACB from it.

2) compute the ACB for each year and convert to CAD using the CRA averaged US$ rate for that year

3) compute the ACB in US$ for all the previous years and you get a
capital gain or loss in US$. Then convert it into CAD using the CRA
averaged US$ rate for 2008 (or the rate on the day it is finally sold).

1) would be the most accurate. But too complicated if the number of trades is huge.
2) seems OK.
3) I am not sure.

Can anyone comment? Thanks
Justin

How do the ACB calculations change when the stock is split? What about Phantom Distributions? Few of my iShares ETFs distributed some phantom distributions earlier this year (Feb 2009) and I am not sure how does my ACB calculation would change due to these. I couldn’t find much information on this except for a website for a company called ACBTracking Inc. that charges $85/- for 10 calculations. Since, I am an individual with just 7 ETFs with no sales, I find it pretty costly to pay $85/- to just calculate my ACB if it’s easier for me to calculate it myself. Hence the questions.

Thanks,
- Amit.

[...] with what occurred next. When Mr. Lipson sold shares to Ms. Lipson, the ITA deems the sale to be at adjusted cost base and not fair market value (since they are spouses and eligible for tax deferral on a rollover [...]

[...] divide that answer by the following: Three times the fair market value (3 x $100,000) less the adjusted cost base (ACB) of the shares [...]

[...] above, you get to claim the FULL amount invested against your income. However, when you sell, your adjusted cost base (ACB) is set to $0, ie. whatever you sell for is your [...]

[...] back to the share holders themselves. The resultant distribution is non taxable but decreases the adjusted cost base of the original purchase (tax deferral). When it comes time to sell in the future, providing that [...]

What is the ACB *after* you’ve sold some of the shares?

Thanks,
Dan.

My question is if you borrow money for investing buy a stock and then sell the stock. How much if any of the money could be taken out without changing the deductibility of the loan..

So an easy example:
10K borrowed…
Buy 10 shares for 1K each.
Sell 10 shares for 1.5K each 6 months later..

Can the 5K increase be taken out of the investing account, as long as the 10K is invested in something else without effecting deductibility of the loan?

1) they do swing around, and I suppose cost averaging would be one good way to get around any minor swings, that instead of purchasing say 1000 shares all at once, it could be done in several stages over days, weeks months or years to the point of reinvesting the dividends, that is if PWE was one of the preferred choices.

2) the other concern I have is the distributions, and I know there are no certainties in life, I have seen distributions on some trust units lowered, even vanished.

But hey, if trust units give the investor the comfort level they need on monthly distributions and can handle any downward swings, then who am I to knock it. My question was what-if the PWE stock dropped below the $30 mark and stayed there

You bring up a good point. Check out one oil trust, Penn West:

http://tools.trustweb.ca/acb_001/tools/distributions/?fundid=8

You’ll notice consistent distributions.

The way I see it – I see cheap oil as unsustainable. I’m betting against cheap oil in the long run. And under those circumstances what matters in the long run is how much oil you control. “Dollar cost averaging” works for oil trust shares in the same way it works for any other index stock.

But thats just my bet – we’ll see how it works out ;)

quote .. “Victor,

The oil trusts are an interesting play in the stock market. Check out Penn West.

Penn West delivers 34 cents *every month* for each share you own. You might be able to offset your increased pump prices with this baby. Plus as oil rises so will the price of the share. For me, the *monthly* dividends sold me on it.”

Geoff, I’d be interested to know how you would protect the investment if the stock price goes down the way it did earlier this year at the beginning of – to the middle of February, or is that of no consequence since PWE keeps paying the same monthly distribution?