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Technical Interpretation - External summary

29 January 2018 External T.I. 2017-0682301E5 - Deemed Distribution and Withdrawal from IRA -- summary under Clause 56(1)(a)(i)(C.1)

. Clause 56(1)(a)(i)(C.1) does not apply to include an amount in income to the extent the amount would not be subject to income taxation in the U.S. if the Taxpayer were resident in the U.S. You have indicated that [the] return of the investment in contract would be excluded from income for U.S. income tax purposes. Based on this…the amount of the Withdrawal would not be included in computing the Taxpayer’s income …. [T]he same [would apply] if the Withdrawal took place in a year subsequent to the Taxation Year in which the Deemed Distribution took place [or] if the Taxpayer was a U.S. citizen, rather than a green card holder, who renounced this US citizenship after becoming a tax resident in Canada [subject to] subparagraph 4(a) of Article XXIV of the Convention …. ...
Technical Interpretation - Internal summary

13 September 2012 Internal T.I. 2012-0442671I7 F - Dédommagement pour la perte de bénéfices -- summary under Paragraph 8(1)(b)

Consequently, paragraph 8(1)(b) does not apply to allow the deduction of legal costs that have been paid to recover such an amount. [Respecting the recovery regarding the Coverage] we suggest that a deduction be allowed for the amount of the legal fees that were paid to recover the damages for the Coverage. You stated that the Dismissal Amount is a taxable amount as a wage or salary or retiring allowance. Thus, we are of the view that the amount paid as a legal expense attributable thereto is deductible in computing the Objectors' income under paragraph 8(1)(b) or 60(o.1) …depending on the circumstances. [T]here is no rule in the Act for the allocation of legal fees. [I]t is reasonable to consider that legal fees should be allocated among the various components. ...

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