Canadian with US resident father wants to buy Canadian

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My question is: Applicable to both US and Canada
QUESTION: Hello - I (Canadian Resident) am considering buying a condo with my father (Canadian Resident) who resides in the US.  
We have some concerns and we were hoping you might be able to give us some ideas.  Our plan is for my parents to use condo when they visit Canada and for myself as possible
retirement location in about 15 to 20 years.  
1.    My father is concerned that if he takes title of condo he will need to report his US income to the Canadian Government (He has been living in US for three years and has no residence in Canada and does not file tax returns.)  
2.    I am concerned that if I take title of condo that when I sell my primary residence in the future it would be subject to the taxable gains tax.
3.    Our ideal scenario would be for myself to take title and rent out property to my parents.  I could then write of fees/taxes and report rental income but my fahter would then have canadian residency.  
Any information you could provide will be appreciated.
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david ingram replies:
1.    The ownership or rental of the condo in Canada does NOT make your father a Canadian resident unless he or your mother ends up spending more than six months a year in Canada.  Goto www.centa.com, read [US / Canada Taxation] and pay particular attention to Article IV (2) which deals with this particular problem.
2.    Ownershiop of the condo will NOT affect the pricipal residence designation of your present home.
3.    If you rent to your father, there are no write-offs because it is not an arms-length deal.  I am assuming tha the rent would not be "market value" here. I would change my mind if you bought a unit is a building with lots of rentals and rented it to your father on an annual basis for the same price that the similar units in the building are renting for.
Goto www.centa.com Goto TAX Book and read the rental income section for more examples of both rentals and people who lost tax cases renting to family members.
David Ingram of the CEN-TA REALTY  Group
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
108-100 Park Royal South
West Vancouver, BC, CANADA, V7T 1A2
(604) 980-0321 - Fax 913-9123 [email protected]
www.centa.com www.david-ingram.com
Disclaimer:  This question has been answered without detailed information or consultation and is to be regarded only as general comment.   Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included."
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