Reference no: EM132568619

On July 1, Mr. Kumar moved from Saskatchewan to Prince Edward Island at the request of his employer. His income earned in PEI for the remainder of the year was $8,800. Mr. Kumar incurred the following costs of moving:

Transport of household effects $5,000

Travel - self, spouse, and three children $2,000

Legal fees - house purchase in PEI $900

Cancellation costs - lease in Saskatchewan $750

Temporary accommodation while waiting

for new house at $70 per day for 30 days $2,100

House-hunting trip (prior to move) $500

Question 1: Which one of the following amounts represents the maximum amount that Mr. Kumar may deduct for moving expenses this year in his personal income tax return?

Option 1) $10,750

Option 2) $ 9,850

Option 3) $7,000

Option 4) $ 8,800