Capital gains exemption can be used without selling the assets THE FEDERAL government has handed taxpayers a@ “once in a lite time” opportunity to tike advantage of the $100,000 capital gains exemp- tion, according to Certified General Accountant (CGA) Ron Adants. “The accounting protession has heen presented with the unique situa tien of being positioned to guide vir- tually all cuents to wike advantage of a genuine- ly benefi- cial, one- time tax planning opportuni- ty” he told a CGA profes- sional development seminar, “Although not every taxpayer may wish to take advantage of this oppor- tunity, every taxpayer should at least consider whether the clection is appropriate for his or her situation.” Adams said the first-step is to _ know: the tax rules. Briefly. if you . * have qualifying investments which - were worth more on Feb. 22, 1994, : than when you ‘got them.-you may declare enough of this capital gain to use up your $100, 000 exemption. By declaring this gain'and claim- ing the offsetting exemption in 1994, you may reduce your future tax bill > when you sell the investment. “~ However, ' increasing your 1994 income this way could, in some situa- “tions, increase your 1994 tax bill. if . $0, you must decide if the future ben- _-efit of using the exemption now out- weighs those present costs. “Then, said Adams; comes the. '.' data-gathering process: Ch List all assets which may produce a capital gain. 0 Determine those assets’ fair market values al Feb,-22, 1994, and_ their adjusted cost bases. Then compute “the accrued capital fer cach asset. (Note there is a restriction on the cap- “ital gain available for the exemption “> for real estate acquired before March. 1992. It doesn’t apply to-gains on’ pemneipal residences.) Find the unused amount of your $100,000 capital gains exemption. See if you have any cumulative net investment loss balance. allowable business investment lasses claimed sige L985 and capital losses of other years claimed since 1985, J Prepare a projected TH tax return for 1994: include capital gains or losses on actual dispositions, but exclude deemed capital gain from the election. Then prepare another pro- jected TE with elected capital gains. “This way you can see any effect FINALLY? A practical & complete Ihe incressed pet incoine will have on the Unemployment insurince claw- hack, Old Age Security pension claw- hack. age amount ckivback, Goods and Services ‘Tax credit, child tix ben- efit and provincial sales tax credit.” Aditiy said. Then, you must decide whether to use any or all of your capital gains exemption and if so. on) which usset(s), he added. “You can see from this why many people will want to consult an accountant to make sure they make the correct choice.” ‘financial planning seminar you can understand! INVESTMENT, TAX AND — ESTATE PLANNING SEMINAR Date: Time: Place: Investment Strategies: © Tax Planning: Estate Planning: ° Save income tax, capital gains election » -® Estate planning, family trusts, living wills * Get the most out of your RRSP, foreign content ‘Wealth is possible in 10, 15, 2C years “Monday, Feb. 6, 1995 7:00 p.m. -9:30 p.m. Westin Bayshore 1601 West Georgia, Vancouver SPEAKERS: Red Woodward, Senior Financial Advisor, IG-Group Tax Manager, Deloitte & Touche Owen C. Dolan, Qc, McCarthy Tetrault Learn More Aboui: @ Global investing — own the great companies of the world, you should have a portfolio * Much more! To register and receive your complimentary $25 ticket call 473- 4004 (24 hrs.) SEATING IS LIMITED ; i wile to noe the seminar, please call 473-4004 for your complimentary ¢ consultation up to 1/2 hous ($150 value) Peter Wienkenkamp ‘$407 Lonsdale Ave, VITAL (VE CB