This is a multi-part message in MIME format.
---------------------- multipart/alternative attachment
My question is: Canadian-specific
QUESTION: Last night some friends and I were discussing wills, executors, and how to leave a family recreational cottage or cabin to family members.
The dreaded capital gains tax that would be payable either by our estate or the kids when we pass on, is quite a problem.
Do you have some advice as to the best way to arrange for a recreational cottage to be written into a will to be left to family members so that they can afford to keep it. Can we insure against future capital gains on a cabin?
The wrong arrangement now could place a huge burden upon the family members later on.
---------------------------------------------------------------------------
david ingram replies:
I love it when two questions lead into each other. The question before this involved a father with a family house which his daughter lived in for 18 years while it was registered to her father. That meant that his estate had to pay capital gains tax when he died and left it to the daughter and her brother.
Now the daughter obviously wants to continue to live in the house she has lived in for 22 years but her younger brother will obviously want his half.
One method of ensuring that there is money to pay the capital gains tax is to buy a life insurance policy on the parents' lives.
However, this does not mean that upon their death, all of the kids will want to keep the cabin.
If you had told me a year ago within 80 days, I would have stroke and my wife would move into another man's house after leaving me, the kids, etc., I would have said, yes, it is possible but nah.
However, a year later, my wife, Jose has a lawyer Rain Henderson who is suing to declare that a house I have lived in for 35 years (was only married to Jose for 21) is Not a family asset. Of course, after moving out and abandoning the kids, house and her dog, when the relationship with the new boyfriend broke up in seven months, Jose now wants the house the apartment, the kids, the cats and child support and alimony even though she moved out with no warning or hints to anyone.
By the time parents pass away and leave the cabin to the kids, a dozen things can have happened which will spoil the best laid plans. One son will be in the middle of a vicious or stupid divorce. One will have lost a job. One will have a medical problem and had to quit work and not have an adequate sickness and accident policy.
---------------------------------------
Commercial
If you are reading this on Wednesday, March 31st, 2004, Fred Snyder, Joe Bowen and I will be doing a little FREE mini seminar at 1764 West 7th at the Cartier Partners Mutual Fund office.
We will be dealing with Mortgage insurance - making your mortgage tax deductible - critical care insurance and alternatives to RRSP's
If you come out tonight from 7 to 9 PM, three of us will be pleased to address your question at no charge.
You or anyone else reading this can register at 604-731-8900
AND
--------------------------------------------------------------------------
Answers to this and other similar questions can be obtained free on Air every Sunday morning.
Starting this Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of Cartier Partners and I will be hosting an INFOMERCIAL but LIVE talk show called "ITS YOUR MONEY"
call on air at 604 280-0600
Those outside of the Lower Mainland will be able to listen on the internet at
www.600AM.com
David Ingram's US/Canada Services
US/Canada/Mexico Tax Immigration & working Visa Specialists
US / Canada Real Estate Specialists
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Calls accepted from 10 AM to 10 PM 7 days a week
Res (604) 980-3578 Cell (604) 657-8451
Bus (604) 980-0321
[email protected]
www.centa.com www.david-ingram.com
Disclaimer: This question has been answered without detailed information or consultation and is to be regarded only as general comment. Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader & the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent financial, or real estate planner or advisor & appropriately qualified legal practitioner, tax or immigration specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included."
The best method of transferring it with the least tax is to transfer it now while everyone is still alive. Have the kids (who want the cabin) pay the present capital gains tax. Just remember
---------------------- multipart/alternative attachment
An HTML attachment was scrubbed...
URL: http://www.centa.com/CEN-TAPEDE/centapede/attachments/7fef45ca/attachment.htm
---------------------- multipart/alternative attachment--
What's Related