22 November 1990 Ministerial Correspondence 903314 F - Limited Partnership Interest and Butterfly Reorganization

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.

19(1)

November 22, 1990

Dear Sirs:

Re:  Limited Partnership Interest and Paragraph 55(3)(b) of the Income Tax Act (the "Act")

We are writing in response to your enquiry of November 22, 1990 wherein you requested our views concerning the treatment of a limited partnership interest held by a corporation for purposes of the "type of property" requirement contained in the above provision of the Act.

In our view, the appropriate characterization of a limited partner's interest in a partnership will depend upon the facts of the particular situation. However, where the limited partner has a significant interest in the partnership we would expect his interest to represent the types of property held by the partnership (e.g. cash and near cash, investment and business property):

The opinions expressed herein are not rulings and are not considered binding on the Department as outlined in paragraph 21 of Information Circular 70-6R2.

Yours truly,

for DirectorReorganizations and Non-Resident DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch