During the current year $(2023),$ Ignacio Rogers sells a non$-$depreciable capital property for $$216,000.$ The ACB of the property was $$184,000,$ resulting in a capital gain of $$32,000.$ Under the terms of the sale, he will receive $10\%($$$21,600)$ of the sale price in the year of the sale, with the remainder due in the following year.

Required:

Calculate the maximum reserve and the amount of the capital gain to be reported in the year of sale.

Part $2$

When an individual converts a principal residence to a rental property, an election under ITA $45(2)$ is available to avoid a deemed disposition based on the change in use.

Required:

Briefly describe how this election works.