The amount by which the taxable capital gains for the year exceed the allowable capital losses for the year is reported on line 139. It is updated from Schedule 3. If the capital losses exceed the capital gains, the unused loss is reported on Form T1A for carry-over purposes.
In addition to generating the schedule of dispositions of capital property (federal Schedule 3, Québec Schedule G), the program also generates Form T657 (Form TP-726.7 for Québec purposes), Capital gains deduction.
If a current or prior year transaction gives or gave rise to a reserve, use Form T2017. Information with respect to reserves allows the program to accurately calculate the capital gains deduction and minimum tax.
Deceased Taxpayer
If the taxpayer is deceased and incurred a capital loss in the year, the allowable portion of that loss is applied against the year's taxable capital gains. The calculation is performed on Schedule 3, the results of which update line 139.
However, if the loss is not absorbed or is only partly absorbed by the capital gains, the unused portion of that loss updates line 25300d, net of any capital gains deductions claimed to date. The amount that can be claimed on line 253d is calculated in a separate workchart (Jump Code: LOSSD); it also takes into account any losses carried back.
See Also