Question 69, taxation 1, Byrd&chen\'s Canadian tax principles PDF

$Question 69, taxation 1, Byrd&chen\'s Canadian tax principles$

Title	Question 69, taxation 1, Byrd&chen\'s Canadian tax principles
Course	Taxation 1
Institution	British Columbia Institute of Technology
Pages	1
File Size	34.3 KB
File Type	PDF
Total Downloads	99
Total Views	138

Preview

CLICK TO PREVIEW PDF

Summary

Answer and question, Byrd&chen's Canadian tax principles...

Description

Question 69, taxation1 ITA 86(1) is often referred to as an estate freeze. Mrs. X. holds all the outstanding 1,000 common shares of a private corporation with an Adjusted Cost Base (ACB) of $1,000 and the current fair market value (FMV) of the shares is $500,000. Mrs. X would like to freeze the value of her shareholding and pass on the future growth of the corporation to her adult children, Y and Z. To accomplish the ITA 86(1) estate freeze,

A. Mrs. X exchanges her 1,000 common shares for redeemable preferred shares with a total redemption value of $500,000. B. Mrs. X sells her common shares to Y and Z for $250,000 each. C. Mrs. X sells her common share to Y and Z for $500 each. D. Mrs. X exchanges her 1,000 common shares for redeemable preferred shares with a total redemption value of $1,000. Answer A...