HOW CAN YOU HELP YOUR FAMILY REDUCE TAX BURDEN OF INHERITING YOUR ESTATE?
‘The Gifting Strategy’
Estate Planning Gifting Strategy – used when you start to give away some of your assets to your children or charities prior to your death in order to minimize the tax burden for your family. Gifting money to your children now could help them reduce the amount of non-deductible interest they pay.
For example, if you can afford to leave your children money and gift it to them now rather than at death, your children could pay down non-deductible interest such as on their home mortgage and/or an investment loan on registered funds (RRSP’s).
If your children are in a lower tax bracket than you or you are trying to keep your income below the old age security threshold, gifting them the money could result in considerable tax savings to you and your estate.
Benefits to The Gifting Strategy include:
- Appreciation and relationship building with your children. The gifting strategy helps to create a transparent discussion space with you and your children. This safe space allows for trust to foster by establishing expectations amongst siblings. Most family members truly appreciate this approach and initiative to keep everything relating to their parents and their wishes “above-board”.
- You will get to see and witness the immediate impacts of your gift to your children while you are still alive, rather than hoping for the best after your death.
- All applicable and remaining tax impacts will be identified and pre-expected and pre-calculated; eliminating unpleasant “surprises” for your loved ones.
For more information on how you can engage your family into a living gifting strategy, BOOK with Chopek & Associate* today!
Chopek & Associate* help small to medium sized businesses and individuals in Edmonton, Alberta, Canada.