Investments

Total 120 Posts

The Life of Pipeline Transactions: The Beat Goes On

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In the past few years, many associated with this blog have written about the benefit of post-mortem pipeline transactions to avoid double tax on disposition of certain assets. Again, and briefly, a pipeline transaction is a form of transaction whereby the assets of a corporation are distributed to shareholders utilizing the high adjusted cost base resulting from the capital gains realized on death, rather than as a distribution in the….

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Canada Revenue Agency, Estate Planning, Investments, Property, Real Estate, Small Business, Tax Issues, Trusts

FAMILY TRUSTS AND ALLOCATIONS OF PROCEEDS FROM SALE

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Recently, I encountered a scenario where the trustees of a family trust were planning an allocation of proceeds from a share sale transaction to the beneficiaries of trust using the lifetime capital gains exemption but it appeared that the allocated amounts would physically end up in the hands of other individuals including the trustees of the trust. It appeared in fact that certain beneficiaries would only see their allocation on….

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Canada Revenue Agency, Investments, Tax Issues, Trustee, Trusts, Uncategorized

Is a Sale for $1 the Same as a Gift?

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Most transactions between parties not at arm’s length with each other (often described as related parties, such as family members), the parties to the transaction are subject to a one-sided adjustment where the transaction proceeds does not equal fair market value (“FMV”). If the price exceeds FMV, then the cost to the purchaser is limited to the FMV while the vendor is taxed based on price. If FMV exceeds price,….

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Canada Revenue Agency, Charitable Giving, Costs, Estate Planning, Investments, Property, Tax Issues, Wills

Significant Tax Re-Assessment Due to An Estate Valuation Gone Wrong

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I have been writing about valuations for estate plan agreements, highlighting that they should be based on fair and reasonable methods, prepared in good faith, properly supported and documented at the time of valuation. In Lewin v. the Queen 2019 TCC 21, The Lewin Estate was appealing a significant tax reassessment of the deceased’s terminal return issued some five years after the original assessment. The issue to be decided is….

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Canada Revenue Agency, Estate Administration, Estate Litigation, Executors, Investments, Tax Issues, Trustee, Uncategorized

SPOUSAL TRUSTS : COUPLE OF UPDATES

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Life insurance policy – rollover at cost? In a recent technical interpretation, the Canada Revenue Agency (“CRA”) confirmed that where a spousal trust is required to pay the life insurance premiums on a policy it owns and is the beneficiary of the policy, a rollover at cost pursuant to the relevant section of the Income tax Act (“ITA”) is not available on the original transfer of assets to the trust…..

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Canada Revenue Agency, Estate Administration, Insurance, Interest, Investments, Spouse, Tax Issues, Trustee, Trusts, Uncategorized

When Cash is not King?

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Most people keep their cash in bank accounts. However, to my surprise, some people still don’t, and for estate planning and administration purposes, this can be a real problem. Take the case of Temple v. Peddle, 2019 NLCA 2 in Newfoundland Labrador. Mrs. Peddle kept cash in a safe deposit box under a joint account with Mrs. Peddle’s son Leo, who was ultimately appointed guardian of her estate. Leo claimed….

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Estate Administration, Estate Planning, Executors, Family Conflict, Geriatric Care Management, Investments, Trustee
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