Enhance The Joy Of Giving And Save Taxes

Most people feel relieved when they get the help they need. This may be an encouraging word for a school teacher or colleague. This may be the support of an old and clever grandfather. It can be a research foundation or a local community organization that helps you. Mothers usually help us from an early age. Whenever we get help, it is gratifying to know that we need help.

Most people have also experienced the benefits of helping others. It makes us feel good, helps others and doesn’t answer any questions. Your qualifying charitable donations may be proof of emotional or financial support. We like to give and accept.

Charities have limited support for the government and need to raise funds to continue their active efforts. The most common way is to raise funds or make direct requests.

Planning

When planning your long-term charitable giving, you may be able to provide more help and provide a steady income for charities. The Canadian government has opened a door to give you more control over your support. You can pay estate taxes and decide where they spend money, or they can make qualifying charitable donations with attractive tax incentives.

Here are some things to keep in mind:

  • A simple bequest in the will allows you to use what you need in your life.
  • A life insurance policy owned by a charity can provide you with a tax credit and a gift to increase your estate.
  • The prescribed annuity has been used, but the new tax law stipulates that tax planning is not attractive.

Example

With life insurance, a 60-year-old man can leave $100,000 in a death to a qualified charity or non-profit organization, and only $1,200 a year after taxes. (It depends on your marginal tax rate). This takes into account the tax credit you receive when you pay for your life insurance. Conditions on how to configure.

Other examples

Starting with the 1998 Canadian budget, 100% of the income in the year of death can be reserved for charities. It applies to estate planning. For example, if you want to get a $200,000 RRSP when you die. It will be your death income; your estate will pay the Canada Revenue Agency nearly $100,000 in taxes. Your family receives the rest.

Suppose you want to leave all RRSP “pre-tax” to your heirs. It will definitely not cost money from your pocket. You can use the RRIF $4,400 (60-year-old male) to buy a $200,000 life insurance policy. This premium represents only 2% of the principal income of $200,000. Leave the $200,000 RRSP to your favorite charity. Get a $200,000 tax credit and don’t pay taxes on your RRSP. Leave $200,000 in tax-free life insurance benefits to your heirs. Most people don’t feel the same happiness when they donate to the Canada Revenue Agency.

In this example, the donor experienced four times the happiness. Instead of giving their heirs $100,000, they doubled the amount to $200,000. Instead of leaving anything to their favorite charity, they donated an impressive $200,000. The children receive twice the happiness by accepting. Their parents will leave an important legacy to a veritable charity and they will be honored and proud. The only person left outside is the tax officer of the Canada Revenue Agency.

To a certain extent, most people are not really destroyed, but they have eliminated the will of the government. The government is also very happy because it does not need to fund charities. They did not decide which charities survived. Now you make a decision based on the financial plan. They give you tax exemption, so you have this control now. The best tax planning. Gordon Hughes, Enhanced Lifestyle Planner and Certified Financial Planner Gordon  has over 30 years of experience in banking and financial services. He shared his understanding of the behind-the-scenes practices that benefit banks, investment companies and big companies, but rarely benefit consumers. It also shares information about how to improve. I have no fear or pressure on the economy and wealth.

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