Question
I am using Turbo Tax Standard 2025 which seems to have a bug and cannot correctly calculate taxable capital gains and CNIL amounts.
For example:
If you have a CNIL of $5,000 from previous years that has been imported to the TurboTax from previous year return, and you sold a stock which generated capital gains of $10,000 which had been entered with T5008 slip, as a result the $5,000 is added as taxable income. This is correct as capital gains are taxed at 50%. However, when you check the box to “Calculate Cumulative Net Investment Loss (CNIL) “ under “Your capital gains profile for 2025” and entering there required information, the amount of taxable gains doubles to $10,000. This in my opinion is incorrect for two reasons. For one if entering the same capital gains via T5008 slip and then again in “Capital Gains (or Losses) in 2025“ seems to me as double Deeping, and Turbo Tax should not ask you to do so. Instead it should use the information from T5008 slip and populate this information in CNIL form if you select to calculate CNIL. Secondly, the CNIL amount imported from previous years should be used to offset taxable gain for current year as part of Capital Gains Deductions. This however, does not seem to be working either.
I would expect the following result with given example above:
Capital Gains of $10,000 (entered via T5008 form) should be taxed at 50% which should result in $5,000 of taxable income. However, because the is a CNLI of $5000 the taxable amount of capital gains should be reduced by this number resulting in $0 for taxable amount for capital gains.
Could you please explain why TurboTax doubles the taxable amount instead of reducing it?
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