[mikeUrban]

If two siblings own a property together (hold title and mortgage jointly) and one decides to move-out and purchase a new property, are both properties exempt from capital gains when sold years later? The sibling who has moved out and purchased a new property still has joint title/mortgage on the other siblings' property, obviously, which is why I am wondering. Does this matter?

 

[cacruden]

I would expect that each individual can have one and only one primary residence, so I would see an accountant to determine how to structure the deal. If nothing is changed, I would expect that half of that residence would become subject to any capital gains in the future (but I am not an accountant). I would contact an accountant to see about structuring it, doing a market value appraisal (since housing prices have probably peaked for a while), etc.

 

[mikeUrban]

I would expect that each individual can have one and only one primary residence, so I would see an accountant to determine how to structure the deal. If nothing is changed, I would expect that half of that residence would become subject to any capital gains in the future (but I am not an accountant). I would contact an accountant to see about structuring it, doing a market value appraisal (since housing prices have probably peaked for a while), etc.

So is the issue, as you see it, that a person cannot be on title for two different properties? I don't think "title" = primary residence. I am going to get professional advise, but wanted to first see what others think.

The way I see it: Two brothers, Bob and Doug, purchase a property together in 2008. In 2012, Bob decides to purchase a new home (which becomes his primary residence), while Doug stays in the home that he purchased with Bob. Each house only has one primary resident. The only possible issue, if it even is an issue, is this: does Bob's continued holding of the title/mortgage on the house that Doug calls his primary residence matter when the two properties are sold?

 

[cacruden]

The way I see it is that you have to declare which one is your primary residence and claim it. To get capital gains (or to waive it) it has to be earned on property that you own.

Doug owns 100% of property A, and 50% of property B. He has to claim one as a primary residence and claim that as a primary residence. I am guessing in most cases it is 100% of property A that will give the biggest bang for the buck.
So if the change in primary residence is up to today, he can waive capital gains on all of the capital gains up until the market value as of now for property B, and start waiving capital gains on property A from now until the future.

Bob owns 50% of property B and he will continue owning 50%. He earns capital gains on that 50% of that property (and can continue waiving it since that is his primary residence).

Now since it is family, I am sure that you could always divest ownership on property B on paper and then lend the money for the purchase of that property to Bob....

That is the way I see it....