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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
Whether the ruling provided in file no. 3-963348 remains valid in light of the fact that the taxpayers involved were divorced effective XXXXXXXXXX (the original ruling was based on a separation agreement dated XXXXXXXXXX).
Position TAKEN:
The ruling will continue to be binding in the manner set forth in file 3-963348.
Reasons FOR POSITION TAKEN:
The Divorce Judgment does not invalidate the separation agreement. Furthermore, XXXXXXXXXX of the separation agreement provides, inter alia, that all of the terms, conditions and provisions of the separation agreement shall survive a divorce and continue in full force and effect.
As indicated in file 3-963348, for purposes of the definition of "qualified farm property" ("QFP") in subsection 110.6(1), the Department's position is that the person meeting the gross revenue test (for property acquired after June 17, 1987) need not be the person who owns the property and may be any of the persons described in subparagraphs (a)(i) to (iii) of the definition. Furthermore, in file 931353, we clarified that "A surviving or divorced spouse who owns such property at the time of disposition will be allowed to claim the capital gain exemption if the gross revenue of the deceased or divorced spouse from carrying on the farming business, at the time the spouse relationship existed, exceeds his income from all other sources for at least 2 years while he owned the property."
XXXXXXXXXX 1-971379
XXXXXXXXXX
Attention: XXXXXXXXXX
XXXXXXXXXX, 1997
Dear Sir:
Re: Advance Income Tax Ruling No. 3-963348
XXXXXXXXXX
This is in reply to your letter of XXXXXXXXXX, wherein you requested an amendment to the above-noted advance income tax ruling dated XXXXXXXXXX, 1997 (the "Original Ruling").
The following is added to the end of paragraph 3 of the Original Ruling:
"XXXXXXXXXX of the Agreement provides, inter alia, that all of the terms, conditions and provisions of the Agreement shall survive a divorce and continue in full force and effect. Pursuant to a Divorce Judgment dated XXXXXXXXXX were divorced effective XXXXXXXXXX."
We confirm that the ruling provided in the Original Ruling will continue to be binding in the manner set forth therein, after giving effect to the above amendment.
Yours truly,
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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