Always compare alternative.

programs before choosing

“WHY HAVEN'T you replied to my letter?’? demands
W.R. And indeed, the whole pile of reader mail, which
never seems to get any smailer, looks accusingly at me.

Michael
Grenby

My column appears in 45 news-
papers across Canada every week,
so. unfortunately I am unable to
reply individually, But I do use
readers’ letters — 93 of them in
the pile at the moment — as a
guide to column topics. And as
. space allows, I answer questions
- with the widest interest.

.: “Pm 60, a widow for 21 years.
My condo needs upgrading but it
‘would be nice to go on a trip. Is
.) there a program so I can use the

_ equity in my home?’’ — J.H.

. “We've been told about reverse

mnertgages, Sut I'm not convinced

they are as great as they appear in

the literature.”’ — H.L.

_ “Ef one can sell one’s home to 2
financia! institution but continue
_ to live there, it seems to make
_ sense — rather than leaving thow-
sands of dollars in home equity to

‘ greedy kids!”? — L.A.
~ Reverse mortgages, also known
as home income or equity plans,
allow you to take out a mortgage;
you continue to own your home.
‘You may use this money to buy a
life annuity (like a pension), take

a lump sum or choose both a

..lump sum and the tax-free annui-—

ty income.

In most cases, you may stay in
the home until you self or die.
‘Then the mortgage (on which you
haven’t had to make any pay-
ments, so it’s been getting larger)
must be repaid.

The older you are (age 60 is
often a minimum), the more
money you can expect to receive
each month or in a lump sum. In

‘exchange, you give up part of the,

. future value of your home.
_-Always compare this. program
with alternatives like having an
. adult child start buying your
. place, for example. -

“Where do I get information on
how to take an income tax prob-
lem to tax court without a
lawyer?’* — W.R.

Ask your local tax offi ice. for
circular TLA7, Filing Appeals to
the Tax Court of Canada, which
describes the process, costs and
other details.

“Pm a single mother with ‘a.
. school-age child. I’ve never been -

on welfare or UI; and work part-

time. I cannot seem te get a credit
. card, even though F have been
~ paying off a $12,000 student loan
faithfully for almost two years.
. Any suggestions?” — M.B.

In your letter, you mentioned
you refused to answer some of the
~pessonal questions on the credit
application. That could ‘cause a
problem. In general, your record
of student foan payments and
simply paying utility and hydro

- bills should help establish your
creditworthiness.

‘Keep trying. Ask why you are
being turned down. And check
your record at the local credit
bureau to make sure there are no
mistakes.

“Last fall I won $2,500 in
Reno. Is there any way to get
back the 39% tax they withheld?”
— W.B.

Blackjack, baccarat, craps,
roulette and the Big 6 Wheel are
exempt from tax, according to
Virginia Perry, of Peat Marwick
Thorne, chartered accountants.
Slot machine and all other win-
nings are taxed.

Some people report that filing a
1040NR (a non-resident U.S. tax
return) has produced repayment
of the amount withheld, but there
is nothing in U.S. tax law to allow
the refund.

“How would you counter the
arguments against RRSPs that you
could be in a higher tax bracket

DOLLARS AND SENSE

when you get back your money,
that if you die and have no
spouse, all the money is taxed in
one year? Are these any alter-
native savings or tax shelter pro-
grams?”’ — A.M.

Those are valid arguments.
Alternatives include investing in

revenue property, the stock mar- |

ket and your own (or another)
business. But because most Cana-
dians don’t have the time and
knowledge to invest successfuily in
these alternatives, the RRSP is
still the best bet in most cases for
the ordinary individual, despite
any shortcomings.

“I own a rental property. Can I
claim home office expenses? How
many properties must one have to
be a business?”’ — G.P.

If you have a room in your
home used solely as an office to
manage your rental property, you
should be able to deduct the
related expenses. ‘‘Reasonable”’ is
the key word.

One property puts you in
business, but when you have two
or more. places, you may then

- deduct more motor vehicle ex-

penses.
See Revenue Canada’s Rentai
Income Tax Guide for more in-
formation: page 8 has the. cetails
about car expenses.
Mike Grenby is a North

-Shore-based colummist and in-

dependent financial adviser who
works with individuals; he will
answer your questions as space
allows — write tu him c/o ‘The

- North Shore News, 1139 Lonsdale

Ave., North Vancouver V7M
2144, :

Reduce Your Estate Taxes

The greatest impediment to

passing property from one

generation to the next is tax.

Find out how to:

° Preserve your estate.

e Reduce the ultimate tax

Hiability

Pau) Milley
BSc., C.L.U., C.H.EC.

688-7208

“Advice is only as goud as the person you ask...”

ZLOTNIK, LAMB & COMPANY

Estate Planning and Retirement Specialists

1200 Park Place, 666 Burrard Street
Vancouver, B.C. V6C 2X8

(604)688-7208 Toll Free Line 1-800-663-3171

%

For our 5 year GIC.

Call 682-7171
for the branch nearest! you.

ECitizens Trust

MEMBER CDIC
Rates subject to change.

Wednesday, April 29, 1992 ~- North Shore News - 19

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NAME

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cry
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Mail to: NSCU, 301-2112 Lonsdale
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t-. ae aw
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