User talk:Alan Baggett

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Divorced father - equivalent to spouse deduction

Alan:

I have been claiming the equivalent to spouse deduction since my separation in 2000 and eventual divorce in 2002. I have 2 children, a son and a daughter, and my ex wife and I share custody. I have the kids more than 40% of the time, and at the time of the divorce, I was making more money than my wife so we agreed on a $304/mo support payment. I claimed the equivalent to spouse deduction for my son in 2001-2003, but Revenue Canada rejected it until I sent them letters from my ex wife and myself, explaining that the support payments were directed to my daughter only - my son I could claim, since I wasn't making support payments for him. This was fine at the time, and worked for 2004 and 2005. Last January, I received a letter from CRA stating that I couldn't claim my son as a dependent because my 2003 divorce order states that I must pay $304 in child support payments. I had my ex-wife write a letter and I wrote a letter explaining to CRA that the situation was the same as it had always been - that the support payments were for my daughter only. I finally received CRA's reply yesterday (June 17) and it was the same conclusion as before: denied! I'm not sure what to do now. Do I need a lawyer? A tax lawyer or a Family Lawyer? Can I change a divorce order to reflect the current situation?

Alan Baggett 13:10, 19 June 2008 (CDT) So if I understand correctly, from 2001-2005 the CRA allowed you to claim your son as the equivalent to a spouse but have denied the claim since.

Do you know if they are planning to reassess the 2001-2005 years and reverse the claim?

When you went through this previously do you save all the documentation? It would help quicken the process if you did.

What you should do is arrange an in-fase metting at your local office (call ahead) and explain the problem. If you can bring OLD documentation that is great. IF not, they should have your copies on file in a file called permanent documents stored in taxroll. As well, your old returns should have all the notations showing the notes and revisions that occurred.

Set up a meeting and ask them to bring all your old returns (2001-2005) as well as any permanent documents to the meeting. This should easily prove your case and resolve your current problem.

If they aren't inclined to meet with you can file an appeal (if you haven't already), you should request access to your tax records under the Access to Information Act and/or you can consider speaking to your MP as a last resort.

I know that doing this is a hassle but it is the only way to solve it. From the sounds of it, whomever assessed your 2006 & 2007 returns did not bother to look at the prior retunrs to confirm that your claim was valid.

Good Luck!

Divorced Father - eligible dependant deduction

Alan:

I have been claiming the equivalent to spouse deduction since my separation in 2000 and eventual divorce in 2002. I have 2 children, a son and a daughter, and my ex wife and I share custody. I have the kids more than 40% of the time, and at the time of the divorce, I was making more money than my wife so we agreed on a $304/mo support payment. I claimed the equivalent to spouse deduction for my son in 2001-2003, but Revenue Canada rejected it until I sent them letters from my ex wife and myself, explaining that the support payments were directed to my daughter only - my son I could claim, since I wasn't making support payments for him. This was fine at the time, and worked for 2004 and 2005. Last January, I received a letter from CRA stating that I couldn't claim my son as a dependent because my 2003 divorce order states that I must pay $304 in child support payments. I had my ex-wife write a letter and I wrote a letter explaining to CRA that the situation was the same as it had always been - that the support payments were for my daughter only. I finally received CRA's reply yesterday (June 17) and it was the same conclusion as before: denied! I'm not sure what to do now. Do I need a lawyer? A tax lawyer or a Family Lawyer? Can I change a divorce order to reflect the current situation?

Hi Alan:

Thank you so much for writing your book. I consider it a gift of love for all Canadians. The truth is so precious, and most of us are so used to smoke and mirrors that it is stunning when we do see the truth. Your honesty and generosity has truly inspired me.

One part I found interesting: if you submit a Notice of Objection to appeal a re-assessment, all collections cease. I would like to confirm this. The reason I am skeptical is that this is based (to my understanding) on CRA procedure and tradition rather than law, and seems to be motivated by loyalty to procedure or office habits. How loyal is each Tax Collector to these procedures?

In my case, the CRA claims via arbitrary re-assessment that the taxpayer owes $50,000 for the years 1999-2002. The 90 days has long passed for appealing this assessment. Then they claimed (about 60 days ago) that the taxpayer owes $50,000 for 2003-2005. All assessments are completely unsubstantiated but they have proceeded with Requirements to Pay at all bank accounts and clients. They have recovered about $500 total--I don't make much money and now I am facing severe financial hardship because of lack of banking and scared clients. The following questions have already been answered by your book and I am merely confirming my interpretation of them.

QUESTION 1: If I submit a Notice of Objection for the latter, will collections cease for the former as well as the latter years?

QUESTION 2: Once they have received the Notice (sent by registered mail of course), may I then apply for payment of all refunds owing over those years?

QUESTION 3: May I also then apply to reverse the Requirements to Pay? How do I do this? Will they comply?

QUESTION 4: If they do reverse the Requirements to Pay, is it true that they will never submit Requirements to Pay again on my account?

Jasmine

NOTICE OF OBJECTION

Hi Alan:

Thank you so much for writing your book. I consider it a gift of love for all Canadians. The truth is so precious, and most of us are so used to smoke and mirrors that it is stunning when we do see the truth. Your honesty and generosity has truly inspired me.

Italic textI'm glad that you're finding the Tax Collector's Bible useful. It provides all the tax information that other books leave out.Italic text

One part I found interesting: if you submit a Notice of Objection to appeal a re-assessment, all collections cease. I would like to confirm this. The reason I am skeptical is that this is based (to my understanding) on CRA procedure and tradition rather than law, and seems to be motivated by loyalty to procedure or office habits. How loyal is each Tax Collector to these procedures?

Italic textCanadian tax law is very clear on this. That if a Notice of Objection is filed, all collection actions must cease until the Objection has been addressed. The only time this does not apply is in jeopardy situations (which are very rare).Italic text

In my case, the CRA claims via arbitrary re-assessment that the taxpayer owes $50,000 for the years 1999-2002. The 90 days has long passed for appealing this assessment. Then they claimed (about 60 days ago) that the taxpayer owes $50,000 for 2003-2005. All assessments are completely unsubstantiated but they have proceeded with Requirements to Pay at all bank accounts and clients. They have recovered about $500 total--I don't make much money and now I am facing severe financial hardship because of lack of banking and scared clients. The following questions have already been answered by your book and I am merely confirming my interpretation of them.

QUESTION 1: If I submit a Notice of Objection for the latter, will collections cease for the former as well as the latter years?

Italic textBecause you have not voluntarily filed your situation is different. First you would have to file any outstanding returns (which includes the arbitrary assessment years). If their assessment differs from what you have provided THEN you can file a Notice of Objection. Courts have agreed that the Appeal process is only for those who file their returns. If you did file it may eleiminate your debt without need of an appeal based on what you have stated prior.Italic text

QUESTION 2: Once they have received the Notice (sent by registered mail of course), may I then apply for payment of all refunds owing over those years?

Italic textReview the above answer. If all your tax arrears are under appeal and you file a credit return, then the credit is to be forwarded to you -it can't be held (unless it involves a jeopardy scenario)Italic text

QUESTION 3: May I also then apply to reverse the Requirements to Pay? How do I do this? Will they comply?

Italic textIt wouldn't be a reversal, it would be a stay until any appeals are settled. If any monies were improperly collected they would refund them after the appeal had been finalized. Italic text

QUESTION 4: If they do reverse the Requirements to Pay, is it true that they will never submit Requirements to Pay again on my account?

Italic text This is a tricky one. What the court ruling came down to on this was that a garnishment was meant to collect one specific debt once and once only from that source. They couldn't collect, refund it and then collect again from that source. So the answer here would be no. Italic text

Italic textGood Luck!Italic text

Jasmine

NOTICE OF OBJECTION

Thanks for this clarification, Alan. Much appreciated.

Happy to be of service. Good Luck!

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