In 2016, Johnny purchased a residential rental property (property #1) just north of Toronto

In 2016, Johnny purchased a residential rental property (property #1) just north of Toronto. The property is rented to an arm’s length party for $3,600 per month. On January 1, 2020, Johnny transferred 50% ownership of the property to his wife Moira, since Johnny was annoyed that he was paying all this tax on the rental property. Johnny’s lawyers advised that Johnny could transfer the residential property at cost, so he wouldn’t trigger any tax. Johnny was also super happy to hear that Moira did not have to pay anything for her 50% share of the property either but could still have her name on title. Johnny took his lawyer’s advice. Johnny and Moira purchased a second rental property