Brian Snow owns all of the common shares of Treeline Boots Ltd.,a Canadian-controlled private corporation.The shares have a fair market value of $150,000,an ACB of $30,000,and a PUC of $5,000.Brian would like to retire soon,so he has offered the company to his son,Walter.Walter is young and does not have a lot of disposable income,and as such,a Section 86(1)estate freeze has been recommended to Brian.Brian's common shares will be converted to preferred shares,which are redeemable for $150,000.
Required:
Discuss the tax consequences of this transaction for Brian,indicating the ACB and the PUC of the new shares.

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The Answer of Brian Snow owns all of the common shares of Treeline Boots Ltd.,a Canadian-controlled private corporation.The shares have a fair market value of $150,000,an ACB of $30,000,and a PUC of $5,000.Brian would like to retire soon,so he has offered the company to his son,Walter.Walter is young and does not have a lot of disposable income,and as such,a Section 86(1)estate freeze has been recommended to Brian.Brian's common shares will be converted to preferred shares,which are redeemable for $150,000.
Required:
Discuss the tax consequences of this transaction for Brian,indicating the ACB and the PUC of the new shares.

Brian Snow Owns All of the Common Shares of Treeline