Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether a certain payment received by a taxpayer from an estate is taxable.
Position: No.
Reasons: The payment was received as gift.
XXXXXXXXXX Randy Hewlett, B. Comm.
2004-007290
June 11, 2004
Dear XXXXXXXXXX:
Re: Estate Payment Received As A Gift
We are writing in response to your inquiry regarding the taxable status of a payment you received from your late brother's estate.
Prior to the death of your brother, you took care of his personal needs and managed his finances. You and four siblings are the beneficiaries of your late brother's estate. Following your brother's death and prior to the distribution of the total assets of his estate, the beneficiaries voluntarily signed an agreement authorizing that you be paid $XXXXXXXXXX from the total assets. The payment was in recognition of the care you provided your brother and your management of his finances prior to his death. In your view, the amount should be considered a non-taxable gift.
We are in agreement with your view that the payment is a gift and therefore, is not taxable under the Income Tax Act.
Yours truly,
Randy Hewlett, B.Comm.
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Planning Branch
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