My Jury is still out on the Saccomanno case too. I've read the case, and read David Ingrams comments, but I'd feel alot better about it if somebody had an independant tax *lawyer* (opinions of accountants are just about useless when it comes to tax law as they cannot defend you in court should you get audited...in fact they can be used against you).ghostryder wrote: ↑Apr 2nd, 2010 2:37 am"professional tax accountant" and radio personality? as opposed to Chartered or Certified Accountant. I have never heard him refer to himself as an "accountant". "Tax preparer" or "tax consultant" sure
Better than his.
Saccomanno bought a (non-legal and not entirely separate) triplex that was already rented (2 units), and moved into the 3rd. He let the tenants stay since evicting them immediately would have been difficult. He proved (and the onus was on him) to the judge that he intended to convert the house back to it's original state as a single family residence. His work/financial circumstances changed and was forced to sell the property.
I know of no Designated accountant or tax lawyer who agrees with Ingram's assertions, nor anyone who has successfully repeated Saccomanno's success. Intending to use the other units as rentals and as a source of rental income would be fatal in tax court as the "tipping point" for the judge was that he demonstrated that he did not intend to use the property for rental income.
Surely if Ingram is correct, someone in the last quarter of a century would have attempted to use Saccomanno in the way that Ingram suggests. Or he would be willing to back someone in a challenge in Tax Court. But he will not.
Anyhow, has anyone actually talked to a tax lawyer about the Saccomanno case?
I've also heard of people arranging for TWO mortgages for a triplex. One for your unit, one for the other two, you pay no principal on the rental unit mortgage until your unit is paid off, thus maximizing your interest deduction. Essentially this is a form of a "Smith Maneuver". Very clever, and apparently supported by case law (1988 Brian Wilson vs CRA, Judge Christie of Tax Court of Canada presiding).