Harvey Case man died on July 15, 2022. At the time of his death, he owned the following assets:

Over the years, Harvey had claimed capital cost allowance on the building. Its undepreciated capital cost is $28,000. In his last will and testament, Harvey directed his executors to transfer the rental property to his two children and the piano to his spouse.

Required:

(a) Determine to what extent, if any, Harvey’s net income for tax purposes for 2022 will be affected by his death.

(b) What are the tax implications to his spouse and children if they sell the property immediately after they receive ownership?

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Rental Property: Land Building Piano Cost $10,000 40,000 5,000 Value $15,000 60,000 8,000