| 19(1) | File No. 5-9003 |
| R. Albert | |
| (613) 957-2098 |
November 28, 1989
19(1)
24(1)
We are writing in reply to your letter of September 25, 1989 wherein you requested whether the above-noted 24(1)
In general, a MURB is a new residential building whose construction commenced after November 18, 1974 and before 1980, and after October 28, 1980 and before 1982, provided certain requirements have been met. Based on these commencement of construction requirements we question whether your building would qualify as a MURB. In addition, we have been unable to locate the above-noted MURB certificate in our files. You may wish to check the MURB certificate number which we have been provided with to ensure that all the digits are correct.
However, should the buildings in question be the subject of a valid MURB certificate, we are providing the following comments. To be eligible for inclusion in Class 31 of Schedule II of the Income Tax Regulations available for 5% capital cost allowance, one of the requirements is that a certificate be issued by Canada Mortgage and Housing Corporation ("CMHC") in respect of the buildings. The name of the party to whom the certificate was issued is not relevant and generally subsequent owners of the building would be entitled to apply against other income, MURB losses generated after claiming capital cost allowance with respect to the building as long as they acquired the building before June 17, 1987. In addition, the MURB provisions are being phased out and the exemption from the rental loss restrictions will no longer be available to investors who acquired a MURB prior to June 17, 1987, for taxation years ending after 1993.
We are enclosing Interpretation Bulletin It-367R2 entitled "Capital Cost Allowance - Multiple-Unit Residential Buildings" for your information. Should you have any questions concerning our response, you may contact the above-noted author of this letter.
We trust that these comments will be of assistance to you.
Yours truly,
for DirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and IntergovernmentalAffairs Branch