this post was submitted on 14 Nov 2023
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I have shares in Computershare that are no longer restricted (I can sell), however they are listed as 423b Subject to disqualification. If I sell them before waiting the full 2 years for the $USD shares to be qualified, do they get taxed as regular income instead of capital gains? Planning to convert to $CAD to invest after selling.

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[–] undercrust 1 points 1 year ago

423b is a US designation for ESPPs that encourages longer term holding for preferred long-term US capital gains rates, so if you're dual-reporting, it's likely going to be one of those wacky situations where you pay capital gains tax in Canada for your CRA return, and then also have to pay additional top-up income tax in the US on your IRS return.

If you're only reporting in Canada, you'll be subject to Canadian tax law and this likely will only incur capital gains taxation as we don't have separate short- and long-term capital gains rates.

IANAA, so if this is a meaningful dollar amount you'll want to consult a qualified tax accountant first.