Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

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j831robert
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by j831robert »

I have noted over the years that Springbok and I share quite a bit of the 'nice problems to have'. The CG tax calculation on our BMO stocks (started to acquire in 1985) and currently showing an increase of 338%, based on (50%) of CG market value today would touch $76K, with similar calculations on Pembina held since year 2000, although mercifully less, showing an increase in value of 307%. I have no intention of selling either in this lifetime so pity my executor who will have to explain to der kinder why the gummint gets such a chunk of their money.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

j831robert wrote:I have noted over the years that Springbok and I share quite a bit of the 'nice problems to have'. The CG tax calculation on our BMO stocks (started to acquire in 1985) and currently showing an increase of 338%, based on (50%) of CG market value today would touch $76K, with similar calculations on Pembina held since year 2000, although mercifully less, showing an increase in value of 307%. I have no intention of selling either in this lifetime so pity my executor who will have to explain to der kinder why the gummint gets such a chunk of their money.
I like your style :) Gosh making money on income trusts! wasn't that risky and didn't they just give you back your money as ROC :) OK just kidding.

j831robert, I don't know if you saw my porrly titled thread about using TFSA to provide cash flow for my new car payments. I am going to stick about 50% with SIN.UN with it's 8.3% current distribution yield. But looking for something different to complement it. Any ideas? Don't really want to use single stocks. I am looking at adding Pembina to my RRIF or maybe a taxable account.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by j831robert »

Springbok: I just finished a longish PM intended for you only to discover you are not amongst the 'self-anointed'. Basically said that I am leery of advising what to buy beyond stating what I own myself, if only because our personal circumstances and my age probably don't/can't fit todays mold. Having said that, my wife holds PPL in a registered account, a personal open account and in a joint account with me, the sum total of which represents 10% of our investments, but I wouldn't personally acquire any more at today's prices.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

j831robert wrote:Springbok: I just finished a longish PM intended for you only to discover you are not amongst the 'self-anointed'.
Sorry about that!
j831robert wrote:Basically said that I am leery of advising what to buy beyond stating what I own myself, if only because our personal circumstances and my age probably don't/can't fit todays mold. Having said that, my wife holds PPL in a registered account, a personal open account and in a joint account with me, the sum total of which represents 10% of our investments, but I wouldn't personally acquire any more at today's prices.
I have a relative who works at high level at Pembina. I keep meaning to have a closer look and perhaps buy a small holding. But have not got around to it :( Retirement takes up so much of my free time!

I now have a good idea of what I am going to do in the TFSA, so no problem.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

I asked BMOIL via Mylink if we would be receiving a notice regarding the IPL conversion. They did not say, but sent a return message saying:
Dear Mr. & Mrs. Springxx,

Thank you for contacting BMO InvestorLine using MyLink. My name is Jxxxxx and I appreciate the opportunity to respond.

The recent IPL conversion is a deemed disposition for tax purpose unless you file a joint tax election for non-registered accounts. This conversion will be reported on the Trading Summary and Gain/Loss report. Please refer to the Corporate Conversion Information at http://www.interpipeline.com/investor/t ... x-info.cfm.

Mr. & Mrs. Springxx, I am taking this opportunity to thank you for your continued business and for using our MyLink service. Please do not hesitate to contact us should you have any other questions about your investment accounts with us

Sincerely,

Jxxxxx
BMO InvestorLine
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by j831robert »

Springbok: Just finished mailing off the necessary statements and forms for IPL's completion. I am fortunate in having subscribed to an ACB computation service and found I still had two comps paid for. Any hickups I will detail here. Report took two pages of close lined type to record all of the goodies since my initial purchase in 2003 and confirmed that my Executor should have a ball with der kinder (although I have established independently a HISA account administered jointly by my first born and his wife to cover the costs of a gathering of any surviving kinder in Las Vegas for a Wake,) thereby escaping complications within my Will.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

j831robert wrote:Springbok: Just finished mailing off the necessary statements and forms for IPL's completion.
I just did the ACB calculation and completed the forms for my wife and I. We only started with IPL.UN in January 2010 (actually earlier, but we transferred these units out of a RRIF in 2010), so spreadsheet not too complex!

I did this as a first run. The units were held in a Joint Account. We can apparently each file separately for 1/2 the number of units. Or we can submit for all units, but then we still have to both submit forms along presumably with a document showing the spit of shares between us. (Last item in the FAQ). I think I will redo individually with prorated number of units, because that is how we filed our returns previously.

I hope it works out for you that you can hold IPL indefinitely!

I have no record of having received anything in mail from IPL or BMOIL indicating we should do this. I wonder how many people are oblivious to fact they will incur a large CG tax?
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

Once we have filed the election form and IPL have submitted it (and sent us a copy), what happens next?

We will likely get two T-slips for 2013? One for the limited partnership to August and one for the corporation from Sept on.

So far as the capital gain is concerned, presumably we use our acb at end of August to calculate acb at end of year (may be same if no ROC). Then continue to track ACB in normal way.

Any requirement for us to submit anything regarding the deemed disposition and election with our return?
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by j831robert »

Yup, a green T5138 and a T5 to play with would be my first guess. Can't see the need for anything else unless IPL has dropped the ball somehow.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

j831robert wrote:Yup, a green T5138 and a T5 to play with would be my first guess. Can't see the need for anything else unless IPL has dropped the ball somehow.
Thanks for confirmation. I must get those election forms sent in soon!
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by 2 yen »

Do I have to send a separate ACB calculation along with the completed Election form? In the list of requirements to submit the Election form, it says to send an ACB calculation. I thought the provided form - the online version printed out, which I've done - was sufficient (?)
Also, is 'YES' the correct answer for the following on the online version of the form?

"Would you like to elect to have the exchange of your Inter Pipeline Class A Units for Inter Pipeline Ltd. Shares occur at your Adjusted Cost Base?"

(I know what ACB is and how to calculate it, but don't know what this means.)

I called the help number, but got a recording saying they would get back to me, but no response yet.

Thanks.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

2yen wrote:Do I have to send a separate ACB calculation along with the completed Election form?
That is what they asked for. I guess they want to check that you have calculated the ACB correctly. I just made up a little spreadsheet and included that.
2yen wrote: "Would you like to elect to have the exchange of your Inter Pipeline Class A Units for Inter Pipeline Ltd. Shares occur at your Adjusted Cost Base?"
I think that means - do you want to convert all your units at total acb, or just a portion of them. For example, if you wanted to incur a partial CG in 2013.

I have my election documents ready to mail today.

I don't recall getting anything from BMOIL asking me to advise them that I had made this election. I have sent them a message advising them anyway. I read that TD had asked to be advised by end of this week.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by 2 yen »

Inter Pipeline called me back this p.m. A calculation of ACB does need to be attached to the election form. There is a model on the website. Also, "YES" is the correct answer to my question above.

Thanks Springbok!
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by j831robert »

They laughed when I sat down at the piano !!! Also when I sat at the computer and asked ACBtracking. to perform for me as usual. Finger trouble, a lack of understanding of the written word, and a second glass of wine with supper all combined to produce something that only resembled what was required. Three tries later and I think I finally got it right. A thumbs up to ACBtracking who kindly agreed to forgive my earlier attempts and provided gratis replacement efforts. The final print-out of actual computations of monthly payouts (initial purchase in 2003) filled two pages -pity my executors.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by 2 yen »

Springbok wrote:
2yen wrote:Do I have to send a separate ACB calculation along with the completed Election form?
That is what they asked for. I guess they want to check that you have calculated the ACB correctly. I just made up a little spreadsheet and included that.
2yen wrote: "Would you like to elect to have the exchange of your Inter Pipeline Class A Units for Inter Pipeline Ltd. Shares occur at your Adjusted Cost Base?"
I think that means - do you want to convert all your units at total acb, or just a portion of them. For example, if you wanted to incur a partial CG in 2013.

I have my election documents ready to mail today.

I don't recall getting anything from BMOIL asking me to advise them that I had made this election. I have sent them a message advising them anyway. I read that TD had asked to be advised by end of this week.
Hi Springbok, Robert - How simple was your spreadsheet for ACB? Can I simply note purchase date, purchase price and then deduct annual Return of Capital amounts for each year I have owned the shares (which I already have anyway for my records)? The reason I ask is because the "illustrative example" on the website includes very detailed monthly amounts to be subtracted and added to arrive at ACB - which would result in a few pages of math. I was directed to the example by the help line at Inter Pipeline. Seems WAY too over the top for a simple ACB calculation. Thoughts?
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

2yen wrote: Hi Springbok, Robert - How simple was your spreadsheet for ACB? Can I simply note purchase date, purchase price and then deduct annual Return of Capital amounts for each year I have owned the shares (which I already have anyway for my records)? The reason I ask is because the "illustrative example" on the website includes very detailed monthly amounts to be subtracted and added to arrive at ACB - which would result in a few pages of math. I was directed to the example by the help line at Inter Pipeline. Seems WAY too over the top for a simple ACB calculation. Thoughts?
I had kept my own ongoing ACB as I do for all holdings. In that I did as you suggested - just deducted the ROC each year. I had come up with $10.24 at beginning of 2013. Their method came up with $10.23, so I presume same result. However, for the submission, I followed their example. I only had a few years to enter because our IPL units were previously held in an RRSP/RRIF

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by sydney2 »

I just did a rough calculation for my Mom's account and her capital gains is about $35,000 on IPL.

I am her agent re Rev Canada. I have chosen to elect to defer tax, my decision is based on the fact that she has just been approved for the Disability Tax Credit and since she has very little in capital losses over the years, (she lives on dividend income and pensions), my thought process is that she will have more deductions re DTC in the future to offset some of her capital gains when she passes. She is 94 and currently not in LTC, but I can see it coming. Biting the bullet and paying the CG tax now, didn't make sense....any comments on this.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by DavidR »

sydney2 wrote:I just did a rough calculation for my Mom's account and her capital gains is about $35,000 on IPL.

I am her agent re Rev Canada. I have chosen to elect to defer tax, my decision is based on the fact that she has just been approved for the Disability Tax Credit and since she has very little in capital losses over the years, (she lives on dividend income and pensions), my thought process is that she will have more deductions re DTC in the future to offset some of her capital gains when she passes. She is 94 and currently not in LTC, but I can see it coming. Biting the bullet and paying the CG tax now, didn't make sense....any comments on this.

Is IPL her only investment? If she has a portfolio 10x bigger, with 10x the capital gain, I would seriously consider crystallizing some gains every year that she is still alive, (if you can do so without OAS clawback issues, etc.) to reduce the amount of capital gains in the year she dies. After all, if the gains are large enough in the year of death, some could be subject to the top marginal tax rate... Maybe some gains can be reported earlier, at possibly much lower tax rates. YMMV - it depends of course on what tax bracket she is in today... Large pension or small? Large dividends or small?
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by 2 yen »

Springbok wrote:
2yen wrote: Hi Springbok, Robert - How simple was your spreadsheet for ACB? Can I simply note purchase date, purchase price and then deduct annual Return of Capital amounts for each year I have owned the shares (which I already have anyway for my records)? The reason I ask is because the "illustrative example" on the website includes very detailed monthly amounts to be subtracted and added to arrive at ACB - which would result in a few pages of math. I was directed to the example by the help line at Inter Pipeline. Seems WAY too over the top for a simple ACB calculation. Thoughts?
I had kept my own ongoing ACB as I do for all holdings. In that I did as you suggested - just deducted the ROC each year. I had come up with $10.24 at beginning of 2013. Their method came up with $10.23, so I presume same result. However, for the submission, I followed their example. I only had a few years to enter because our IPL units were previously held in an RRSP/RRIF

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Thanks VERY much Springbok! Mission accomplished.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by sydney2 »

Thanks David R for your input. I am going to post a reply in the tax portion of this forum, as it doesn't belong totally to IPL. Thanks
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by sydney2 »

In my own situation re IPL, most of the gains are held in registered accounts, RIF/TFSA'S. The ACB on IPL in my non registered account, is not that high and since I have some crystalized losses in my non-registered account, I will pay the CP tax now rather than later.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by schmuck »

2yen wrote:
Springbok wrote:
2yen wrote: Hi Springbok, Robert - How simple was your spreadsheet for ACB? Can I simply note purchase date, purchase price and then deduct annual Return of Capital amounts for each year I have owned the shares (which I already have anyway for my records)? The reason I ask is because the "illustrative example" on the website includes very detailed monthly amounts to be subtracted and added to arrive at ACB - which would result in a few pages of math. I was directed to the example by the help line at Inter Pipeline. Seems WAY too over the top for a simple ACB calculation. Thoughts?
I had kept my own ongoing ACB as I do for all holdings. In that I did as you suggested - just deducted the ROC each year. I had come up with $10.24 at beginning of 2013. Their method came up with $10.23, so I presume same result. However, for the submission, I followed their example. I only had a few years to enter because our IPL units were previously held in an RRSP/RRIF

Image
Thanks VERY much Springbok! Mission accomplished.

2 yen
Has anyone noticed that the numbers in the IPL example for the ACB calculation do not exactly agree with the numbers shown on T5013 slips from previous years?
Although it says that illustrative example is meant as a reference only, it seems that numbers are just too close (and sometimes the same) to be hypothetical.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

BMOIL finally have posted a message on Mylink regarding the tax election. Perhaps my exchange of messages with them helped spur them on :).

Not sure what they mean by "submission of instructions", but I had previously sent them a message informing of my election and they adjusted the on-line average cost to refllect my original IPL.UN cost rather than the conversion cost (which they had entered at time of conversion).
BMO InvestorLine shareholders are advised to review the information circular regarding possible tax consequences.

Please note, the onus is on the shareholder to complete the election form and file for the tax deferral if they wish to participate.

Pursuant to the plan of arrangement, Inter Pipeline's unitholders received one common share of Inter Pipeline Ltd. in exchange for each Class A Unit held. The effective date of Inter Pipeline's corporate conversion was September 1, 2013. Unitholders may elect to affect the exchange of Class A Units for common shares on a tax-deferred basis for Canadian federal income tax purposes for their holdings as of the effective date.

It is important to note that the Tax Election form (CRAT2057) must be signed and mailed to Inter Pipeline on or before December 01, 2013.

Please refer to www.interpipelinefund.com for full details on the election procedure and information required to prepare the forms or call them at 1-877-941-1828. Inter Pipeline has also set up an Electronic Election Assistant on their website to assist shareholders with completing the forms but they must still be mailed.

The Tax Election must be made jointly by IPL and a shareholder. IPL will make the Tax Election only if IPL receives a validly completed election form executed by a shareholder on or before the 90th day following the Effective Date at the following address:

2600, 237 - 4th Avenue S.W.
Calgary, Alberta T2P 4K3
Attention: Tax Election Processing

BMO InvestorLine requests that you direct inquiries pertaining to the offer (other than submission of instructions) to Inter Pipeline Fund Class A. Shareholders are advised to obtain independent advice and consult the offering circular regarding any possible tax consequences and for further details of the offer.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Mouly »

Yes, I too just got a notification from BMOIL about this. Apologies if this is posted clearly somewhere in the previous pages but I want to make sure I have the correct order of operations if I don't want to do a deemed disposition.

Are the steps:

- calculate ACB
- send calculation to IPL along with notice of intention not to have a deemed disposition
- want for confirmation note from IPL
- forward that note to BMOIL with same notice of not doing a disposition
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Springbok »

Mouly wrote:
Are the steps:

- calculate ACB
- send calculation to IPL along with notice of intention not to have a deemed disposition
- want for confirmation note from IPL
- forward that note to BMOIL with same notice of not doing a disposition
This is as I see it (assuming just one holder. For couple read options on IPL site)

- Calculate acb using data and method on IPL site
- Fill in the election data using the on-line guide on IPL site
- Print the election form immediately after completing the guide (they don't save input)
- Fill in your SIN and sign form
- Mail form along with acb calculation to IPL.
- IPL will check and if all is good, countersign your form and then forward to CRA. They will send you a copy.
- No need to send anything to BMOIL, but I did advise them using Mylink. Phoning should also be good.

After doing this, BMOIL corrected my average cost to reflect my IPL.UN costs rather than the cost at time of conversion.
Last edited by Springbok on 16 Oct 2013 11:54, edited 1 time in total.
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