2018 Ruling 2018-0780201R3 - Post-mortem pipeline -- summary under Subsection 84(1)

CRA provided rulings for a pipeline transaction in which the estate with a resident beneficiary sells a company (Opco) with apparently a real estate business to a Newco for consideration consisting mostly of a note, followed by an amalgamation of the two companies and the repayment by Amalco to the estate of the note over time. These pipeline transactions are to be immediately preceded by transactions in which the estate utilizes Opco's capital dividend account to step up the ACB of a portion of its Opco shares and also to redeem those Opco shares so as to generate a capital loss that can be carried back under s. 164(6).