Précis: The taxpayer’s father, since deceased, was an American citizen. He had an individual retirement account (“IRA”). On his death a share of that IRA was transferred to a new IRA for the benefit of the taxpayer. CRA added that share to the taxpayer’s income, and allowed him tax credit for the American tax he had paid on the transfer. The taxpayer took the position that the amount was a non-taxable inheritance and appealed to the Tax Court. The Tax Court dismissed his appeal holding that the amount was specifically taxed under clause 56(1)(a)(i)(C.1) of the Income Tax Act (the “Act”). There was no order as to costs since this was an informal procedure appeal as a “foreign retirement arrangement”.
Owen v. R. – TCC: Funds received from taxpayer’s deceased father’s American IRA taxable.READ MORE »