There are four requirements for subsection 56(2) to apply: i. the payment must be made to some person other than the taxpayer against whom a reassessment is made; ii. the distribution must be made pursuant to the direction of, or with the concurrence of, the taxpayer against whom a reassessment is made; iii. the payment must be made for the benefit of the taxpayer against whom a reassessment is made or to some other person as a benefit that the taxpayer desired to have conferred on that other person; iv. the payment would have been included in the income of the taxpayer against whom a reassessment is made if the latter had received it himself (see Neuman v. M.N.R., 1998 CanLII 826 (SCC), [1998] 1 S.C.R. 770).
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