Is CMHC fee tax deductible for a work related move? -
Hi there,
I came across your email on the Internet and
would like to know if you can answer a question for me about CMHC fees
(I live in Canada):
I am wondering about the CMHC fee in
terms of a tax deductible... is the CMHC fee is tax deductible as a
result of a work-related move?
I lived in B.C. and my employer and I
agreed for me to relocate to Alberta (move took place October 2006). We
put our house for sale, but it did not sell until the following year
(April 2007) and so we carried that property until it sold, and bought
in Alberta... we had no choice but to have the CMHC fee because our
house did not sell, so we could not afford to put 25% down on a house,
and didn't want to risk losing out on the property we bought. Under
these circumstances, wouldn't the CMHC fee be an allowable moving
expense to claim?
I have been all over the Internet and
cannot find a thing about CMHC fees in terms of income tax (except a
bit of info related to rental properties). I checked the CRA website
and the section for Eligible Moving Expenses, but it's like reading a
foreign language at times and the only section that it MAY be included
(which it doesn't appear to be is):
-legal or notarial fees for the purchase
of the new residence, as well as any taxes paid (other than GST/PST or
property taxes) for the transfer or registration of title, to the new
residence...
I have asked my accountant to look into
this and this was her reply (I am somewhat disturbed that my accountant
does NOT have the answer for me, and it was my accountant that e-filed
my return and submitted the CMHC fee as part of my moving expenses when
I listed all of my expenses for 2006):
The deductibility of the
CHMC fee is not clearly spelled out anywhere.
Enclosed is the material on
the CRA website on eligible moving expenses
(read the section which is
noted with a *). I would think that the CHMC
fee follows under this area.
You will have to file a
Notice of Objection (within 90 days of your
Notice of Reassessment dated
December 24, 2007) if you wish to dispute
the disallowance of the CHMC
fee. Please let me know if you want us to
prepare an objection for you.
Please give me a call if you
have any questions. Thanks.
So any light you can shed for me would
be a great help—I do not want to waste time or more money paying my
accountant to draft up a Notice of Objection if there is no chance it
will work (not only would I have to pay the government back the portion
of tax for wrongfully submitting my CMHC fee as part of my moving
expenses for 2006, I would also have to pay my accountant for this
service, which did not work).
Thanks very much,
david ingram replies:
I have never seen or heard of anyone deducting the CMHC fee and do not see why it would be deductible because it is a financing fee. But i come from a time when nothing was deductible for tax purposes on a move and every couple of years, something else gets added. Write your Member of Parliament and complain.
In the meantime, You have until April 30th to file a Notice of Objection for a 2006 tax return. However, nothing stops you from filing one on your own. If you win at the objection level, that's it, let me know. If you lose at the objection level, you can go to the Tax Court on your own.
Why, would you do this? While waiting fro your court date, someone else may win the same thing giving you a precedent and an automatic win.
Good luck - I am putting this out on my list to see if anyone else has an idea.
On Mar 14, 2008, David
Ingram wrote:
It is very unlikely that blind or unexpected email to me will be answered. I receive anywhere from 100 to 700 unsolicited emails a day and usually answer anywhere from 2 to 20 if they are not from existing clients. Existing clients are advised to put their 'name and PAYING CUSTOMER' in the subject line and get answered first. I also refuse to be a slave to email and do not look at it every day and have never ever looked at it when I am out of town. e bankruptcy expert US Canada Canadian American Mexican Income Tax service and help
However, I regularly search for the words"PAYING
CUSTOMER" and always answer them first if they did not get spammed out.
For the last two weeks, I have just found out that my own email notes
to myself have been spammed out and as an example, as I wrote this on
Dec 25, 2007 since June 16th, my 'spammed out' box has
47,941 unread messages, my deleted box has 16645 I have actually looked
at and deleted and I have actually answered 1234 email questions for
clients and strangers without sending a bill. I have also put aside
847 messages that I am maybe going to try and answer because they look
interesting. -e bankruptcy expert US Canada Canadian American
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$1,700 would be for two people with income from two countries
Catch - up returns for the US where we use the Canadian return as a guide for seven years at a time will be from $150 to $600.00 per year depending upon numbers of bank accounts, RRSP's, existence of rental houses, self employment, etc. Note that these returns tend to be informational rather than taxable. In fact, if there are children involved, we usually get refunds of $1,000 per child per year for 3 years. We have done several catch-ups where the client has received as much as $6,000 back for an $1,800 bill and one recently with 6 children is resulting in over $12,000 refund.
David Ingram expert income tax service and immigration help and preparation of US Canada Mexico non-resident and cross border returns with rental dividend wages self-employed and royalty foreign tax credits family estate trust trusts income tax convention treaty advice on bankruptcy
It is very unlikely that blind or unexpected email to me will be answered. I receive anywhere from 100 to 700 unsolicited emails a day and usually answer anywhere from 2 to 20 if they are not from existing clients. Existing clients are advised to put their 'name and PAYING CUSTOMER' in the subject line and get answered first. I also refuse to be a slave to email and do not look at it every day and have never ever looked at it when I am out of town. e bankruptcy expert US Canada Canadian American Mexican Income Tax service and help
Therefore, if an email is not answered in 24 to
48 hours, it is likely lost in space.
You can try and resend it but if important AND YOU TRULY WANT OR NEED
AN ANSWER from 'me', you will have to phone to make an appointment.
Gillian Bryan generally accepts appointment requests for me between
10:30 AM and 4:00 PM Monday to Friday VANCOUVER (Seattle, Portland, Los
Angeles) time at (604) 980-0321. david ingram expert
US Canada Canadian American Mexican Income Tax service and help.
david ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
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My Home office is at:
david ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
My Home office is at:
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
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Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 9 PM 7 days a week Vancouver (LA) time - (please do not fax or phone outside of those hours as this is a home office) expert US Canada Canadian American Mexican Income Tax service help.
Disclaimer:
This question has been answered without detailed information or
consultation and is to be regarded only as general comment. Nothing
in this message is or should be construed as advice in any particular
circumstances. No contract exists between the reader and the author and
any and all non-contractual duties are expressly denied. All readers
should obtain formal advice from a competent and
appropriately qualified legal practitioner or tax specialist for expert
help, assistance, preparation, or consultation in connection with
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David Ingram
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Phone consultations
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This is not intended to be definitive
but in general I am quoting $900 to $3,000 for a dual country tax
return.
$900 would be one T4 slip one W2 slip
one or two interest slips and you lived in one country only (but were
filing both countries) - no self employment or rentals or capital gains
- you did not move into or out of the country in this year.
$1,200 would be the same with one
rental
$1,300 would be the same with one
business no rental
$1,300 would be the minimum with a
move in or out of the country. These are complicated because of the
back and forth foreign tax credits. - The IRS says a foreign tax credit
takes 1 hour and 53 minutes.
$1,600 would be the minimum with a
rental or two in the country you do not live in or a rental and a
business and foreign tax credits no move in or out
$1,700 would be for two people with income from two countries
$3,000 would be all of the above and
you moved in and out of the country.
This is just a guideline for US /
Canadian returns
We will still prepare Canadian only
(lives in Canada, no US connection period) with two or three slips and
no capital gains, etc. for $200.00 up.
With a Rental for $400, two or three
rentals for $550 to $700 (i.e. $150 per rental) First year Rental -
plus $250.
A Business for $400 - Rental and
business likely $550 to $700
And an American only (lives in the US
with no Canadian income or filing period) with about the same things in
the same range with a little bit more if there is a state return.
Moving in or out of the country or
part year earnings in the US will ALWAYS be $900 and up.
TDF 90-22.1 forms are $50 for the
first and $25.00 each after that when part of a tax return.
8891 forms are generally $50.00 to
$100.00 each.
18 RRSPs would be $900.00 - (maybe
amalgamate a couple)
Capital gains *sales) are likely
$50.00 for the first and $20.00 each after that.
Catch - up returns for the US where we use the Canadian return as a guide for seven years at a time will be from $150 to $600.00 per year depending upon numbers of bank accounts, RRSP's, existence of rental houses, self employment, etc. Note that these returns tend to be informational rather than taxable. In fact, if there are children involved, we usually get refunds of $1,000 per child per year for 3 years. We have done several catch-ups where the client has received as much as $6,000 back for an $1,800 bill and one recently with 6 children is resulting in over $12,000 refund.
This is a
guideline not etched in stone. If you do
your own TDF-90 forms, it is to your advantage. However, if we put them
in the first year, the computer carries them forward beautifully.
This from "ask an income trusts tax service and
immigration expert" from www.centa.com or www.jurock.com or www.featureweb.com. David Ingram deals on a daily basis with expatriate tax
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