Five years ago, a depreciable asset was transferred from Mark's estate to a qualifying spousal trust created on his death. The asset, which cost $224,000, had a UCC of $147,200 at the time of transfer. At the time of Mark's death, the asset had a fair market value of $262,400. Since then, the trust has claimed CCA of $15,400. At the end of the current year, the trust sold the asset to an arm's length party for $243,200.
Determine the tax consequences of the transfer of the asset to the spousal trust and of the disposition of the asset by the trust. Determine the maximum amount of trust income that can be allocated to Mark's spouse from the sale.

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The Answer of Five years ago, a depreciable asset was transferred from Mark's estate to a qualifying spousal trust created on his death. The asset, which cost $224,000, had a UCC of $147,200 at the time of transfer. At the time of Mark's death, the asset had a fair market value of $262,400. Since then, the trust has claimed CCA of $15,400. At the end of the current year, the trust sold the asset to an arm's length party for $243,200.
Determine the tax consequences of the transfer of the asset to the spousal trust and of the disposition of the asset by the trust. Determine the maximum amount of trust income that can be allocated to Mark's spouse from the sale.

Five Years Ago, a Depreciable Asset Was Transferred from Mark's