Income Tax Severed Letters - 2012-01-13

Ruling

2011 Ruling 2011-0403031R3 - Post mortem planning

Unedited CRA Tags
84.1(1) and (2); 84(2); 245(2)

Principal Issues: Whether a pipeline transaction implemented by the Estate will be subject to subsections 84(2) and 245(2)

Position: No

Reasons: The proposed pipeline transaction satisfies the administrative requirements established by the CRA in previous rulings issued in respect of similar arrangements

2011 Ruling 2011-0409601R3 - Loss Consolidation

Unedited CRA Tags
20(1)(c); 20(3); 112; 15(1); 56(2); 245(2); 246(1)

Principal Issues: Is the proposed loss consolidation acceptable?

Position: Yes

2011 Ruling 2011-0417741R3 - Supplementary ruling

Unedited CRA Tags
84.1(1), 84(2) and 245(2)

Principal Issues: Supplementary ruling to 2011-040303

Technical Interpretation - External

5 January 2012 External T.I. 2011-0412581E5 - Right to use a patent - eligible property

Unedited CRA Tags
85(1.1)

Principal Issues: Whether a right to use a patent qualifies as eligible property under 85(1.1).

Position: The right to use the patent is property as defined in 248(1). Whether the right to use the patent is capital property to the transferor is a question of fact.

4 January 2012 External T.I. 2011-0425511E5 - ASPE - SBD - GIFI

Unedited CRA Tags
125(5.1)

Principal Issues: Impact on the Business limit reduction in first year ASPE is adopted.

Position: General comments.

Reasons: See response.

3 January 2012 External T.I. 2011-0423061E5 - Qualified Farm Property

Unedited CRA Tags
110.6, 248(5), 85(1), 70(9.21), 70(10)

Principal Issues: 1) Does subsection 110.6(1.3) of the Act apply for the purpose of determining whether "shares of a particular corporation are "shares of the capital stock of a family farm corporation"? 2) Would arrangements such as a cash rental, crop share, custom work and a joint venture with a non-related farm corporation affect the individual's ability to claim the capital gains exemption and/or the individual's ability to transfer these shares to the individual's children on a tax deferred basis

Position: 1) No. 2) General comments provided.

Reasons: 1) If an individual's shares of a particular corporation are determined to be "shares of the capital stock of a family farm corporation" those shares would be "qualified farm property", as that term is defined in subsection 110.6(1) in their own right and there would be no need to refer to the additional requirements set out in subsection 110.6(1.3) of the Act in making such a determination. 2) IT-268R4, IT-349R3 and IT433R were indicated as addressing the questions.

28 December 2011 External T.I. 2011-0430261E5 - Subsection 104(2) of the Act

Unedited CRA Tags
104(2), 108(1) and 220(2.01)

Principal Issues: Does subsection 104(2) apply to a hypothetical scenario?

Position: Yes

Reasons: The requirements of subsection 104(2) are met.

16 December 2011 External T.I. 2011-0419211E5 F - Choix à 45(2)

Unedited CRA Tags
54 " résidence principale "; 40(4); 45(1); 45(2); 70(6)
devisee of changed-use principal residence cannot benefit from s. 45(2) election by estate in years following testator’s death

Principales Questions: 1) Est-ce que le choix en vertu du paragraphe 45(2) effectué dans la déclaration de Monsieur A peut être utilisé dans la déclaration de Madame A?
2) Est-il possible d'annuler le choix dans la déclaration de Monsieur A?
3) Est-ce que la copie du choix envoyée dans la déclaration de Madame A est valide?

Position Adoptée: 1) Non; 2) Question de fait; 3) Non

Raisons: Loi de l'impôt sur le revenu.

14 December 2011 External T.I. 2011-0428021E5 - Charitable Donation by Will

Unedited CRA Tags
118.1(5); 118.1(3)

Principal Issues: 1. where a will provides for a spousal trust with trustee encroachment power plus a specific bequest to be made to charity upon the death of the spouse...will the deceased get a 118.1(5) credit? and If no to 118.1(5), will the spousal trust be entitled to a 118.1(3)credit.when the donation is made upon death of the spouse

Position: 1. question of fact

Reasons: 1. depends completely on wording of will and powers given to the trustees