The Lifetime Capital Gains Exemption (LCGE) is available to all Canadian residents and Americans living in Canada as a tax deduction on the sale of a Qualified Small Business Corporation (QSBC). It is indexed to inflation, and it can be used in part.
Three tests must be met to claim an LCGE, and there are complicated regulations governing each of these. There are implications regarding succession planning, and its benefits can be multiplied through use of family trusts. An LCGE can be a significant deduction, and Canadian or dual Canada/US tax residents need professional help devising a tax-efficient strategy.
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