Reference no: EM132806619

Problem 1: In October of last year, Chris moved from his rented Calgary townhouse to his new home in Toronto to commence a sales position with a life insurance company. After training and client development time, his earnings from this new position were $5,000 for the year, but they were expected to increase as he developed his client base. As a result of his move, Chris incurred the following expenses: Lease cancellation payments on his Calgary townhouse - $1,000; Legal fees to acquire a new home - $5,000; Moving van - $2,200; Flight and five days' accommodation in Toronto - $2,500; Shipping his car - $900. Which of the following is TRUE of the income tax consequences of the move for Chris?

Option 1: Chris can claim all of the moving costs listed above, subject to the new work location income test

Option 2: Chris cannot claim the $5,000 legal fees pertaining to the acquisition of his Toronto home

Option 3: Eligible moving expenses that cannot be claimed for last year as a result of the new work location income test can be carried forward to next year

Option 4: Chris cannot claim any of the costs listed above