Scenario 92: A client is considering selling a highly appreciated asset. To reduce the immediate tax impact, what strategy could a financial planner suggest?

Question: Scenario 92: A client is considering selling a highly appreciated asset. To reduce the immediate tax impact, what strategy could a financial planner suggest?

Answer options:

• Gifting the asset to a family member.
• Selling the asset and immediately reinvesting the proceeds. ✅ Harvesting capital losses from other investments to offset the capital gain.
• Transferring the asset to a TFSA.

Correct answer: Harvesting capital losses from other investments to offset the capital gain.

Explanation: Capital losses can be used to offset capital gains, reducing the overall taxable capital gain for the year and thus lowering the immediate tax impact. The correct answer is "Harvesting capital losses from other investments to offset the capital gain.". This capacity-fill scenario 92 reinforces the same competency for the cfp bank and follows the certified explanation standard.