REnted house for five years - is it taxable or should he move in?

QUESTION: I have a rental house for 5 years now and I plan on either making it my primary residence (in Canada) or sell it. I believe either way, I will have to pay capital gains. Would it be better to make it a primary residence first and pay capital agains or sell it?
> What are the ways to avoid or reduce capital gains?
> ________________________________________________________
david ingram replies:

I just do not have time to answer this - it was originally rejected, but the last one as I was closing down for the night. I hope that the following prior Q & A might help or give you an idea. If you did live in the house, you could have made a 45(2) election

-------------------------
My question is: Canadian-specific

QUESTION: I have owned my home for 4 years and have subsequently moved in with my boyfriend and am now planning to sell my home. I have been renting it out for the past six months and am wondering about the tax implications relating to capital gains, thank you in advance, Adele.
_______________________________
david ingram replies:

You have not been living with the boyfriend long enough to be considered a common-law spouse sop at the moment - for a year anyway - you can both have a principal residence tax free.

After that, you are limited to one as a common law couple. Since you are selling yours now within a year, you will get any profit capital gains tax free by filing a section 45(2) election with your 2006 return reporting the rental income on schedule 776.

Attach a note to your 2006 tax return stating something like this

I hereby elect to consider the residence at xxx address, city, prov,etc, to be my principal residence for up to four years even though i did not ordinarily inhabit it after (date).

When you do sell, complete form T2091 to calculate the tax free portion. Form 2091 says you to do not need to file it with your return but keep it in case the CRA wants to see it. My suggestion is that you send it with the return and get it over with.

These older questions will give you a little more:

>> QUESTION:
>>
>> Hi,
>>
>> Last year, we rented out our condo in Vancouver. The
>> plan then was to have the rent cover our mortgage
>> payments for the 12 months that we would be away. A
>> short term solution.
>>
>> Now, we are planning to be away from BC for a longer
>> period of time (approx. 2 years) and wish to sell the condo
>> in the middle of the year, as we are unable to rent the
>> condo for any longer due to strata council by laws.
>>
>> 1) If we sell the condo when there has been a tenant living
>> in it for 12 months, will we pay capital gains?
>>
>> 2) What are our best options to avoid paying this tax?
>>
>> 3) If capital gains would be owed, for how long would we
>> have to make the unit our principal residence again before
>> we can sell it and not pay CGT?
>>
>> Thank you,
_________________________________________________________________

david ingram replies:

If you filed a section 45(2) election with your first year's rental, you
can rent the condo out for up to 4 years (plus 1 in the calculation)
without incurring capital gains tax if you have not bought another
residence that you are living in.
See Below:

My question is: Canadian-specific

QUESTION: Dear Mr. Ingram,
I bought a house in the December of year 2000, lived there till the end of December 2000 (3 weeks) and started to rent it out on January 1, 2001. I filed the election 45(2) to claim the house as my primary residence for years 2001, 2002, 2003 and will do it for 2004.
I do not claim a depreciation for those years.
I want to sell the house now. Do I need to move in house first in order to avoid the payment of the capital gain taxes. For how long I have to stay there to be eligible for not paying the capital gain taxes on sold house if I need to move in.

Thank you in advance for you help,
----------------------------------------------------------
david ingram replies:

First I am going to repeat your old question from last July and my answer.

My question is: Canadian-specific

QUESTION: Hi, David!
I would like to know is it possible to use the election under the section 45(2) again if the old house is sold and the new one is bought. Can it be used unlimited number of times by the condition that it is used for each house only once.

Thank you
---------------------------------------------------------------------------
David Ingram replies:

Section 45(2) is intended to allow people to try something out. This means that if you move to a rented condo for a couple of years and rent your house out, you can move back into the house without suffering a capital gains tax under section 45(2).

Since it was passed on June 17, 1972, (32 years ago now) I have never seen it used more than twice by one person.

Does not mean it has not been used more than twice in thirty years, it just means it is unlikely.

There is no numeric restriction but if you are moving in and out of houses, the CRA will treat you as a trader and tax you at full rates.

----------------------------------------------------------
Now, to answer this question. Section 45(2) is NOT something you can plan to use. In other words, your living in the house for three weeks and renting it out and filing a section 45(2) election does NOT make it tax free if you bought the house to rent and not to live in as your personal principal residence.

Your question indicates to me that you are trying to beat the system and did not buy the first house to live in and unless you can show the tax office that you moved every stick of furniture in and really intended to live there, the CRA will not allow it to be sold tax free.

This year, a new policy of the CRA is that they wish form T2091 to be filed with every tax return where a personal house was sold during the year.

If it was your residence and you genuinely intended to live there and were transferred of suddenly got married or could not stand your neighbour or lost your driver's licence or suffered some other disaster that caused you to "HAVE TO" move suddenly, filing section 45(2) will make it tax free provided you did not also own another house that you did live in. If you did own another house that you actually lived in, claiming the house you have filed the 45(2) election for as tax free, will MAKE THE HOUSE YOU ACTUALLY LIVED IN TAXABLE.

If you have a genuine 45(2) election, you do not need to move back in. If it is not a genuine 45(2), moving back in will TRIGGER a tax bill as you move in.

You need a consultation with someone who knows the rules before you make a mistake. I am available in person or by phone at a fee of $350.00 minimum for an hour but not until November now.

As many know, I charge this for US / Canada tax an immigration advice as well. I am not alone though.

If you have a tough US immigration question to ask or one that I cannot deal with (remember I do Immigration AND tax) Joe grasmick is the place to g for a telephone consultation. HIs fee is $295.00 per HALF hour and you can get hold of him at http://s1.amazon.com/exec/varzea/ts/exchange-glance/Y01Y4838730Y0462867/104-8053170-6203936

I have sent two out of town people to him in the last month where it was obvious to me tha tthe people needed a lawyer as opposed to a consultant..

elling former resident section 45(2)

QUESTION: Hi David,

Please help.

I bought a Calgary condo in Oct 2003, and lived in the condo until March 2005, when I bought my present house.

The condo was rented from April 2005 to August 2006, and I sold it in Nov 2006, at a gain.

My question: Would I qualify for the Principal Residence exception and be exempted from Capital Gains tax for the condo sale?

Thanks.

Best Regards,

---------------------------------------------------------------------------
__________________________________________________________________
david ingram replies:

I am too busy for this but hope you get something from the following:

>>
>> QUESTION:
>>
>> Hi,
>>
>> Last year, we rented out our condo in Vancouver. The
>> plan then was to have the rent cover our mortgage
>> payments for the 12 months that we would be away. A
>> short term solution.
>>
>> Now, we are planning to be away from BC for a longer
>> period of time (approx. 2 years) and wish to sell the condo
>> in the middle of the year, as we are unable to rent the
>> condo for any longer due to strata council by laws.
>>
>> 1) If we sell the condo when there has been a tenant living
>> in it for 12 months, will we pay capital gains?
>>
>> 2) What are our best options to avoid paying this tax?
>>
>> 3) If capital gains would be owed, for how long would we
>> have to make the unit our principal residence again before
>> we can sell it and not pay CGT?
>>
>> Thank you,
_________________________________________________________________

david ingram replies:

If you filed a section 45(2) election with your first year's rental, you
can rent the condo out for up to 4 years (plus 1 in the calculation)
without incurring capital gains tax if you have not bought another
residence that you are living in.

If you have bought and lived in another house, you have to choose one or the other as your tax free residence for the time you owned both.

See Below:

My question is: Canadian-specific

QUESTION: Dear Mr. Ingram,
I bought a house in the December of year 2000, lived there till the end of December 2000 (3 weeks) and started to rent it out on January 1, 2001. I filed the election 45(2) to claim the house as my primary residence for years 2001, 2002, 2003 and will do it for 2004.
I do not claim a depreciation for those years.
I want to sell the house now. Do I need to move in house first in order to avoid the payment of the capital gain taxes. For how long I have to stay there to be eligible for not paying the capital gain taxes on sold house if I need to move in.

Thank you in advance for you help,
----------------------------------------------------------
david ingram replies:

First I am going to repeat your old question from last July and my answer.

My question is: Canadian-specific

QUESTION: Hi, David!
I would like to know is it possible to use the election under the section 45(2) again if the old house is sold and the new one is bought. Can it be used unlimited number of times by the condition that it is used for each house only once.

Thank you
---------------------------------------------------------------------------
David Ingram replies:

Section 45(2) is intended to allow people to try something out. This means that if you move to a rented condo for a couple of years and rent your house out, you can move back into the house without suffering a capital gains tax under section 45(2).

Since it was passed on June 17, 1972, (32 years ago now) I have never seen it used more than twice by one person.

Does not mean it has not been used more than twice in thirty years, it just means it is unlikely.

There is no numeric restriction but if you are moving in and out of houses, the CRA will treat you as a trader and tax you at full rates.

----------------------------------------------------------
Now, to answer this question. Section 45(2) is NOT something you can plan to use. In other words, your living in the house for three weeks and renting it out and filing a section 45(2) election does NOT make it tax free if you bought the house to rent and not to live in as your personal principal residence.

Your question indicates to me that you are trying to beat the system and did not buy the first house to live in and unless you can show the tax office that you moved every stick of furniture in and really intended to live there, the CRA will not allow it to be sold tax free.

This year, a new policy of the CRA is that they wish form T2091 to be filed with every tax return where a personal house was sold during the year.

If it was your residence and you genuinely intended to live there and were transferred of suddenly got married or could not stand your neighbour or lost your driver's licence or suffered some other disaster that caused you to "HAVE TO" move suddenly, filing section 45(2) will make it tax free provided you did not also own another house that you did live in. If you did own another house that you actually lived in, claiming the house you have filed the 45(2) election for as tax free, will MAKE THE HOUSE YOU ACTUALLY LIVED IN TAXABLE.

If you have a genuine 45(2) election, you do not need to move back in. If it is not a genuine 45(2), moving back in will TRIGGER a tax bill as you move in.

You need a consultation with someone who knows the rules before you make a mistake. I am available in person or by phone at a fee of $350.00 minimum for an hour but not until November now.

As many know, I charge this for US / Canada tax an immigration advice as well. I am not alone though.

If you have a tough US immigration question to ask or one that I cannot deal with (remember I do Immigration AND tax) Joe grasmick is the place to g for a telephone consultation. HIs fee is $295.00 per HALF hour and you can get hold of him at http://s1.amazon.com/exec/varzea/ts/exchange-glance/Y01Y4838730Y0462867/104-8053170-6203936

I have sent two out of town people to him in the last month where it was obvious to me that the people needed a lawyer as opposed to a consultant..

Canadian taxes when working overseas

I work in Equatorial Guinea 28 x28 days on and off ,returning back to BC. The company I work for pays tax in EG on my behalf, what taxes should i be paying here in canada
___________________________________________
david ingram replies:

The Guinea income is just as taxable in Canada as if you were working in Moose Jaw or Truro.

You have to add the tax they are paying for you to what they pay you specifically and report the gross to Canada on lines 104 and 433 and the appropriate lines on forms T2036 and T2209 of your T1 Canadian Income Tax Return.

You will then claim the foreign taxes you paid to EG as a Foreign tax credit on line 431 of schedule 1 and the appropriate line on T2209 of your T1

However, if you are working for a Canadian Company, you may be able to fill out Form T626 and claim an Overseas Employment Tax Credit First.

Capitol Gains on inherited house in Canada (sic)

My mother had a trust deed done so that when she passed away, I inherited her house. I didn't live there. Her and I received some money in 2006 before she died for an option to purchase. Do I have to claim this as capitol gains? She passed away in June 2006. I sold the home in March 2007. Will I have to pay capitol gains on it next year? I already pay a mortgage on property I bought last July 2006.
______________________________________
If you own and live in another house, and mother's house was not rented out after her death, you have a choice of claiming mother's house tax free for the time from her death until you sold it or your own house tax free for the same time period.

It is likely easier to claim your own tax free because after paying selling costs, etc., there is not likely any gain on mother's house particularly if there was an option to purchase price established befoe her death.

GST on property purchase (hobby farm)

We are considering buying a residence that is on 10 Acres and is owned by people who have been growing flowers and selling them to Canadian Tire. The property is zoned minimum 10 acres. The flowers are not the primary source of income. The property has farm status. The property has a residence which is used full time by the owners of the property. Will full GST have to be paid on the purchase of this property?

____________________________________________________________________________
david ingram replies:

I don't know from the information given.

The following older answer may help.

My question is: Canadian-specific

QUESTION: I am buying an acreage in BC. I am told that I have to pay GST on the purchase price. Is this because it has farm status? Can I get the GST back?
---------------------------------------------------------------------------
david ingram replies;

Farms are tough and depends upon whether it is a working farm and being sold as a working farm or for the personal use of someone. The decision on whether or not to charge GST is the decision of the vendor, not the purchaser. If the vendor decides not to charge and the CRA decides that GST should have been charged, the vendor is liable for the tax because it is assumed that the price included the GST. Therefore, a farmer who was a GST registrant is ALWAYS going to want to charge GST.

There is no general exemption for the sale of farm land
* A Farm Land Transfer to Family Members Exemption (Farming Exemption)

However, there IS a limited exemption on the sale of farm land if:

the property was used by the individual himself and was farmed at any time;
* immediately before transferring the property the property has been farmed; and
* the new use of land must be personal to the individual or to the relative of the individual
*
A similar exemption also extends to the sale by a corporation, partnership or trust with the same criteria as above.

This prevents G.S.T. becoming payable on a deemed change of use of farm land to personal use or the conveyance of farm land to a family member.

We just went through this with a working farm sold to someone who intended to farm it. GST was payable. \

In this case, to defer the GST, you must register as a farm yourself and then, after paying the tax, you will get an input credit and a refund when you file your first return. Recognizing that this can be an immense cash flow problem, the government has come up with form ???? or you can defer the tax by filling in a form ??? . David Stoller, a lawyer in the same building as us at (604) 922-4702
*
can likely give you the name of the form and since he has just finished such a transaction for the seller is likely as good a lawyer as any to help with yours.

His office is at:

801-100 Park Royal South
West Vancouver, BC
V7T 1A2

non-resident spouse

My_question_is: Applicable to Another Jurisdiction or Multi-jurisdictions
Subject: non-resident spouse
Expert: [email protected]
Date: Thursday March 22, 2007
Time: 09:51 PM -0500

QUESTION:

Hello,
My spouse does not reside with me in Canada, he is a New Zealand resident. We both takes turns visiting each other.
In preparing my tax return I entered that I was married, however it asks for my spouses income. Since he is not Canadian and does not reside with me in Canada am I obligated to provide this information? I personally do not know his exact income. I am self-supporting in Canada and do not rely on his income.
How do I enter this information?
__________________________________________________________________________________________________________
david ingram replies:

You need to put in some income to make sure that you do not receive any tax credits that you are not entitled to when you are married and their are two incomes in the family if you are married and living together in heart and spirit and a month or two a year physically.

If you are really actually separated and are not living together because you do not get along in close quarters for more than a couple of weeks at a time, than you should put separated on the return and his income would not be relative.

I have a good friend who did not live with his wife for at least ten years, dated other people but used to take vacations with his wife. Then suddenly, after ten years or
so, they started living together and had two children and are still together fifteen years later.

Love is a strange commodity that waxes and wanes for years and years..

And in another aside which has nothing to do with your question, I talked to one lady client today who had come from her lawyer with whom she is re-opening her property settlement from thirty years ago. You would recognize the names so I have to be careful with what I say. However, the second wife has now gone to the first wife to tell her how much the mutual ex-husband did-in the first wife.

I had the same thing happen several years ago with another highly recognizable figure and was a dangerous ploy for the third wife. In this case, wife number three dragged wife number two in to get her help in saying what a cad their mutual ex husband was. The second wife did manage to get a bundle but she received it as part of the third wife's settlement because the third wife had actively participated in the hiding of assets AND money from the second wife. But the female judge awarded half to the husband and the two exes split the other half much to the chagrin of wife number two who ended up getting less than a third (after $150,000 of legal fees) of what the husband had offered in an amicable settlement at the start. A female judge too who did not like either wife because it turned out that wife number two had helped hide assets from wife number one who was no longer around.

Yep love moves in mysterious ways.

I am a Canadian working in the US with a TN1

I moved to Nevada for a job July 2006, and still work there now. Do I do my
taxes in canada and us seperately? My earnings for 2006 in Canada were very
low.
_______________________________________________
david ingram replies:

You have more than one choice.

1. a) You file a departing Canada tax return including form T1161 and 1243 and 1244 if you left more than $25,000 worth of assets behind.

b)
You file a 1040NR Dual Status Statement for the US and then a 1040 Dual Status Return to report the US income only. The statement is there to separate out any US income you may have received BEFORE you actually went to the US. You can NOT claim the standard deduction on a Dual Status Return You can only use itemized deductions on a Dual Status Return.

2. a) You file Canada as in 1a) above.

b) You file a 1040 tax return reporting your world income for the year including the Canadian income. Then you file US form 1116 to claim a foreign tax credit for the tax, CPP and EI you paid to Canada. This allows you to claim the standard deduction on the US return.

Good luck. Remember that you can always send the returns here by fax, courier snail mail or pdf email.

US / Canada Income Tax Returns what forms needed

Hi David,
>
> I was reading your e-mails and saw this one. Could you tell me which forms that we could fill out to possibly some some money and time? We have a small business in Canada ,husband is a dual US/Can. citizen, I am canadian. We live together in the US where Rodger works full time and I do not work. We have Canadian and US investment income. Would forwarding last year's tax returns help? How do we go about applying for a US extension as we will not get everything to you in time?
>
> Thanks,
>
>
>
>
> _______________________________________
david ingram replies:

The CRA asks for the information you will find on Form T2124 for the business - print out

http://www.cra-arc.gc.ca/E/pbg/tf/t2124/t2124-06e.pdf

and try and fit as many numbers as you have into the lines on that form. The closer you come to those categories, the better. The less numbers I have to sort or add together, the smaller the preparation charge.

You will note that this form also has specific breakout spots for a claim for an office in the home and motor vehicle expenses.

These same numbers will them be converted and go onto US form Schedule C.

For the US, I need the year end figures for Dec 31 2005 and Dec 31 2006 for any Canadian RRSP accounts you have. These go on Form 8891 which you will find at

http://www.irs.gov/pub/irs-pdf/f8891.pdf

Assuming the total of all your financial accounts in Canada is over $10,000 US, you also need to fill in forms T D F 90-22.1

which you can see at

http://www.irs.gov/pub/irs-pdf/f90221.pdf

If your accounts total over $10,000, I need the

Name of the Financial Institution,

Holder of the account - You , Rodger or joint

Account number

Highest balance in 2006 (not necessarily or likely to be December 31st)

For the rest I need any:

* bank information slips from Canada. T3, T5, NR4, 5013 slips.
* bank information slips from the US. 1099 Misc, 1099-Div, K-1, 1042S
* Rodger's W2 slip or 1099-Misc

anything else that you think might be relevant.

A copy of the 2005 US and the 2005 Canadian and 2005 State return if in a tax filing state.

For an Extension 'You' or us will need to file the simple US form 4868 which you will find at:

http://www.irs.gov/pub/irs-pdf/f4868.pdf

>
> From: US / Canada Income Tax Help - CEN-TAPEDE <[email protected]>
> Reply-To: [email protected], [email protected]
> To: CENTAPEDE <[email protected]>, jurock <[email protected]>
> Subject: US USA / CANADA Income Tax Help - Here is a price list - sort of - Quote during the busy season- David Ingram gives expert income tax & immigration help to non-resident Americans & Canadians from New York to California to Mexico family, estate, income trust trusts Cross border, dual c
> Date: Wed, 28 Mar 2007 19:46:31 -0700
> >[email protected]: Please see bottom of message if you wish to unsubscribe.
> >------------------------------------------
>
>
>
> Hi David
>
> First question is whether you will be taking additional clients during this hectic season.
>
> I am interested in your services and would love to get a quote for your services
>
> The situation:
>
> I am a unmarried US-Canada dual citizen living in Canada (Vancouver) with my parents (no rent).
> I graduated from university last spring and I now run a Sole proprietorship in Computer Consulting full time from home.
> I have both a GST and PST number though none of my clients have been from Canada.
>
> My main client is from the United States and are paying me as a consultant.
> I have also helped several individuals from around the world (none in Canada) with smaller jobs.
> If you require more information to make your assessment please let me know.
> Please let me know if you can take this task and send me a quote for tax preparation.
> Please also let me know which documents are required.
>
> Thanks!
> Even if you are unable to help me this year I would still love to receive a quote if it is for the following year.
>
> _______________________________________________________
> david ingram replies:
>
> You were rejected by the system as just one of too many emails today.
>
> However, baring a major catastrophe with our staff and associates, I see no reason that we could not look after you this year.
>
> As a US citizen, you have to file a US return whether you work in the US or not. All we have to sell is our a time. The better prepared you are, the less the charge for preparation. It would help if you had the totals asked for on Form T2032 (available at CRA website). http://www.cra-arc.gc.ca/E/pbg/tf/t2032/t2032-06e.pdf The Instructions for the form and self-employment in general are at: http://www.cra-arc.gc.ca/E/pub/tg/t4002/t4002-06e.pdf I have asked for this form because you are based in Canada.
>
> If you were based in the USA, I would suggest that you have the figures asked for on Schedule C http://www.irs.gov/pub/irs-pdf/f1040sc.pdf - Read the instructions at http://www.irs.gov/pub/irs-pdf/i1040sc.pdf
>
> In either case, we have to convert the currencies and fill in both forms to do the dual country returns.
>

CPA questions Canadian will with deceased attorney

My father lives in Toronto and I live in the US. He was told that because the attorney that drew up his will has passed away, that in order for the will to be valid he will need to see another attorney to draw up another will. I am an only child, mother deceased, his only heir. It is a simple estate: deposits and auto, no real estate. Is someone just trying to get more money from him or this true? Really appreciate your help.
_________________________________________________________
david ingram replies:

Wills law differs from province to province and from state to state.

I am not an attorney, lawyer, barrister or solicitor but unless the rules have changed, the lawyer who drew the will up being alive has never been a rule that I know of and I did have offices in 30 states and five provinces including Ontario.

To be valid, an Ontario will must have two witnesses who are not beneficiaries.

If the will is verrrrry old, it should maybe be revised or relooked at, but even that would be unusual if you are the sole beneficiary.

In fact, if he wanted to put the deposits in joint tenancy with right of survivorship and the car is a $5,000 car, there would not be any reason for him to have a will. If it is an expensive car, even the car can be registered in joint tenancy.

Note that I do NOT recommend that he do this because you might run away with the money but it is a simple solution that many parents have with their children.

And, since the question refers to a 'CPA' questioning the will, I think that it is a US CPA that has told this to you rather than someone telling your father, n'est-ce pas?

Splitting capital gain and investment income, where should we attach the T5 &T3 to?

QUESTION:
My wife and I have a joint investment account for about 7 years and have our own individual investment accounts for different length of time(3years for her,2 years for me).

1. For the last 7 years I have declared all the capital gains and investment income of our joint account and my individual account on my income tax return which is pure ignorance and to our disadvantage even though the the total amount was not large.

2. Now we want to declare 50%/50% of our capital gain and investment income of our joint account because the amount is becoming quite significant.

3. Can we just ignore the past and start to do this now?Do we need to explain to CRA?Do I need to attach all the T5 and T3 slips on both of our returns?(Then we would have no copies of our own.)

We thank you very much for the help!

Regards.
_________________________________________________________
david ingram replies:

1. Under Section 74.1 of the Canadian Income Tax Act, The account is taxable to the spouse who put the money into the account. Therefore, If you gave her $10,000 and she puts it into an account in her name, any earnings in that account on the first $10,000 is taxable to YOU forever. The earnings on the earnings are taxable to her however.

Therefore, if you put the money into the joint account seven years ago, any earnings on the original amount or any further amounts you put in are correctly taxable to you. These are called the 'Attribution Rules'.

But, if the earnings were left in the plan, 1/2 of the earnings on the earnings would be taxable to her.

On the other hand, if the joint account was an inheritance from her father and was put into a joint account, the reverse would be true and everything on the original amount would be taxable to her with 1/2 of the earnings on the earnings taxable to you.

The same is true of the individual accounts you have.

Your question is really based upon, 'what happens if you suddenly switched'? The answer is that in 43 years in this business with 155 offices of my own in 5 provinces and the management of H & R Block offices before that in three provinces, I have only seen the tax office go after two couples under the attribution rules. And that involves the preparation of well over 3,000,000 tax returns over .

The ONLY ones I saw were H & R Block clients in Saskatchewan. One was in Kipling Saskatchewan and the other in Weyburn Saskatchewan and I won both by tracing minor amounts of money that the wives had earned and saved during World War II as being justification for the husbands splitting the proceeds from the family farms which were sold 30 years later. The farms, of course, were only in the Husband's names under the VLA (Veteran's Land Act) rules but it was the $1,000 or $1,500 that the wives had saved which was used to get the farms going.

In your case, it may be that if you gave your wife the money, you were just paying her back while she supported you through electrical engineering.

In truth, you need to do a spread sheet and figure out what is what 'just in case'.

It may be that the split should be 38% <> 62% or 20% <> 80% or 49% <> 51% but you can certainly make the switch without much worry about being questioned by the CRA, particularly since Stephen Harper's government is clearly on track for a joint tax return sometime in the future.
_____________________________________________

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REnted house for five years - is it taxable or should he move in?

elling former resident section 45(2)

Canadian taxes when working overseas

Capitol Gains on inherited house in Canada (sic)

GST on property purchase (hobby farm)

non-resident spouse

I am a Canadian working in the US with a TN1

US / Canada Income Tax Returns what forms needed

CPA questions Canadian will with deceased attorney

Splitting capital gain and investment income, where should we attach the T5 &T3 to?

Monday 06-Dec

Sunday 05-Dec

Friday 15-Oct

Wednesday 15-Sep

Tuesday 14-Sep