Principal Issues:
1. Whether a donation constitutes a gift for income tax purposes when the donation is subject to various conditions.
2. Where six corporations, their controlling shareholder and a public foundation enter into an agreement with respect to a donation, will subsection 15(1) apply to include the amount of the donation made by any of the corporations in the shareholder's income?
Position:
1. Factual determination. In this case, based on the facts, the donation would constitute a gift for income tax purposes.
2. No. The terms of the agreement provide that any of the corporations may make the gift.
Reasons:
1. In previous files, we concluded that the fact that there are conditions attached to a gift, does not, it itself, negate the gift. Generally, a donation would qualify as a gift if the donor is freely parting with the funds or property, receives no benefit, other than recognition, in return and the funds or property can never revert to the donor or any related person.
2. The corporations, the shareholder and the public foundation are all parties to the agreement.