15 October 1997 Internal T.I. 9706467 - MEDICAL EXPENSES - SEALED COMBUSTION FURNACE

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

Meaning of the term "sealed combustion furnace"

Position:

A combustion furnace is defined as a furnace whose source of heat is the energy released in the oxidation of fossil fuel. A sealed combustion furnace does not use the air from the house for combustion. It is a closed furnace system. There is no chance for the air or combustion products to escape into the house.

Reasons:

Meaning of the term "combustion furnace" - Mcgraw-Hill Dictionary of Scientific and Technical Terms. Discussions with Natural Resources Canada.

		October 15, 1997

	Sydney Tax Services Office	HEADQUARTERS
	Individual Services Division	B. Kerr
(613) 957-2139
	Attention: Lee Ann Browne
		970646

Medical Expenses - Regulation 5700(c.2)

This is in response to your memorandum of March 5 1997, requesting our comments on the meaning of the term "sealed combustion furnace" as used in paragraph 5700(c.2) of the Income Tax Regulations (the "Regulations") for the purposes of eligible medical expenses under paragraph 118.2(2)(m) of the Income Tax Act (the "Act").

The situation you describe involves a taxpayer that has Emphysema and whose lung capacity is less than 50%. The taxpayer was advised by his doctor that in order to improve his breathing, he must change his heating system. The taxpayer has referred to IT-519R and noted that a "sealed combustion furnace" may qualify as an eligible medical expense. However, he has been unable to determine what that means. As a result, you have requested our comments on this issue.

Our Comments

Paragraph 118.2(2)(m) of the Act provides that a medical expense is an amount paid for any device or equipment for use by the patient that: is of a prescribed kind; is prescribed by a medical practitioner; is not described in any other paragraph of this subsection; and meets such conditions as are prescribed as to its use or the reason for its acquisition. Paragraph 5700(c.2) of the Regulations provides that for the purposes of paragraph 118.2(2)(m) of the Act, a device or equipment is prescribed if it is an electric or sealed combustion furnace acquired to replace a furnace that is neither an electric furnace nor a sealed combustion furnace, where the replacement is necessary solely because of a severe chronic respiratory ailment or a severe chronic immune system disregulation. It is a question of fact whether the four conditions outlined in paragraph 118.2(2)(m) of the Act, as well as the requirements of paragraph 5700(c.2) of the Regulations, would be met in any particular case.

With respect to your specific concern, we have researched several dictionaries for the meaning of a "sealed combustion furnace" and have been unable to find a definition for this expression. However, the 4th edition of the Mcgraw-Hill Dictionary of Scientific and Technical Terms defines the term "combustion furnace" as a furnace whose source of heat is the energy released in the oxidation of fossil fuel. In addition, we have discussed the term "sealed combustion furnace" as used in the Regulations with Natural Resources Canada and they have advised us that a sealed combustion furnace does not use the air from the house for combustion. It is a closed furnace system, such that the air or combustion products cannot escape into the house.

C. Chouinard
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch