What is the ACB (Adjusted Cost Base)?
The adjusted cost base or “ACB” is generally what you originally paid for your investment. However, once you realize the tax deductions from the Limited Partnership, you are deemed to have an adjusted cost base (ACB) of nil, due to the receipt of the tax deductions which will approximately equal your original investment amount. A nil adjusted cost base means that when you sell your investment, you get to claim capital gain which gets preferential tax treatment in comparison to otherwise paying tax on income.
