| 24(1) | 901141 |
| S. Short | |
| (613) 957-2134 |
Attention: 19(1)
October 11, 1990
Dear Sirs:
Re: Paragraph 74.5(3)(b) of the Income Tax Act (the "Act")
This is in reply to your letter dated June 7, 1990 wherein you asked whether a joint election as described in paragraph 74.5(3)(b) of the Act may be filed after the date that the income tax return for the taxation year during which the spouses separated is due.
The Draft Amendments to the Income Tax Act and Related Statutes issued by The Honourable Michael H. Wilson, Minister of Finance (July 1990) proposes amending the requirement that the election be filed with the income tax return for the taxation year during which the spouses separate. New paragraph 74.5(3)(b) will provide that the joint election may be filed for any taxation year ending after the time of the separation. Where the joint election is so filed, section 74.2 will not apply for the year in which the election is filed (or any subsequent year) in respect of any gain or loss from a disposition of property, or property substituted therefor, that occurs during the period throughout which the spouses are living separate and apart by reason of a breakdown of their marriage. This proposed amendment will be applicable to transfers of property made after May 22, 1985 and loans outstanding on or after May 22, 1985.
We trust that the above comments are of assistance to you.
Yours truly,
for DirectorBusiness and General DivisionRulings DirectorateLegislative and IntergovernmentalAffairs Branch