5 December 1990 Income Tax Severed Letter

By services, 22 July, 2022
Language
English
Document number
Severed letter type
Miscellaneous
d7 import status
Drupal 7 entity type
Node
Drupal 7 entity ID
657630
Extra import data
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"field_external_guid": [
"menu:://Federal Income Tax [CCH Tax ]/Tax Window Files/Tax Window Files/Tax Window Files/1990s/1990 [DC90_029.031 - NV90_431.432]/DC90_190.191 — In-house Loss Utilization"
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"field_proprietary_citation": [],
"field_release_date_new": "1990-12-05 07:00:00",
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}
Main text

December 5, 1990

Director                           Current Amendments and
Special Audits Division             Regulations Division
                                   W.R. McColm
                                   957-2068
Attention: Sharon Gulliver
           Tax Avoidance Section
                                   F-3973

In-House Loss Utilization

This is in reply to your memorandum of November 5, 1990 concerning the above subject matter.

In your memo you asked for comment from a policy perspective on the two examples described. In example 2 the taxpayer corporation utilizes non- capital losses carried forward (that are about to expire) by transferring capital property to a subsidiary created for the purpose and recognizing the appropriate amount of accrued gains therein. This is followed shortly thereafter by an amalgamation (or wind-up) of the parent and the subsidiary.

          21(1)(b)

Your second example would not seem to fit into this category and, therefore, falls within the stated lenient policy of Finance in respect of in-house loss transfers.

21(1)(b)

Please contact us if we can be of further assistance.

R. D'Aurelio Director Current Amendments and Regulations Division

c.c. Al Short Department of Finance