No doubt many U.S. legislators were chewing on tax reform over the U.S. Thanksgiving weekend, as well as enjoying their turkey, as unprecedented momentum is moving U.S reforms ahead at breakneck speed demonstrating Congress's desire to complete tax reform before year end.
One of the questions we often get asked by people who are planning their estates or for incapacity is who they should appoint to be the executors of their will or their substitute decision makers if they become incapable. (In Ontario, substitute decision makers during incapacity are known as attorneys for property or personal care if appointed by the individual in a power of attorney or guardians for property or personal care if appointed by the Court - see our Client Advisory Powers of Attorney for more information).
On January 1, 2017, most of the provisions of the All Families Are Equal Act (Parentage and Related Registrations Statute Law Amendments), 2016 (S.O. 2016, c. 23) came into effect in Ontario. The intention of the Act is to establish new rules of parentage in Ontario to deal with the modern reality of assisted reproduction and surrogacy when it comes to who is, and who is not, a parent of a child and allow for non-biological parentage structures without the necessity of Court intervention. This involved updating and revising a number of statutes to make related amendments, such as to the Vital Statistics Act (Ontario) to reflect the new rules as they affect birth registrations.
As we return from Labour Day weekend and reflect back on the summer that never quite was, a major issue that will grab attention over the next weeks, now that it's business as usual again, is the government's recent tax proposals.
In March of this year, I wrote about the complications which can arise in administering an estate of an individual who owns a vacation home in a U.S. state such as Florida or Arizona. In that blog, I discussed issues in estate administration which arise from the multi-jurisdictional location of assets and the requirements to obtain probate in different places. Another type of complication which can occur arises from the probate rules in other jurisdictions and the ways they differ from, and are not compatible with, the probate rules in Ontario.
July 1, 2017 is not only Canada's 150th birthday and a cause for great celebration, which we are eagerly looking forward to. It is also the date that Canadian financial institutions must have in place appropriate procedures to provide information to Canada Revenue Agency on financial accounts held by non-residents of Canada, which will begin in 2018.
The Ministry of Finance recently introduced a 15% tax on the purchase or acquisition of a residential property in the Greater Golden Horseshoe by individuals who are not citizens or permanent residents of Canada or by foreign corporations or taxable trustees. The new Non-Resident Speculation Tax ("NRST") is in addition to the Ontario and Toronto land transfer taxes. Although the NRST is subject to the approval of the legislature, it is currently in effect and applies to any agreements of purchase and sale entered into after April 20, 2017.
Most taxpayers know that when you sell an asset which has increased in value, the federal Income Tax Act provides that you will generally be liable for capital gains tax on the net increase in value, unless there is an applicable exemption. One exemption from capital gains tax is for a principal residence. In October of 2016, the federal government introduced draft legislation to amend the rules to restrict the application of the principal residence exemption. The amendments are aimed at stopping non-residents of Canada and real estate developers from unreasonably claiming the exemption. However, the amendments can also affect anyone who currently has or may wish to have a trust which holds a residence for a beneficiary, whether or not they are tax resident in Canada.
On April 26, 2017, with great fan-fare, the White House announced bold proposals for tax reform, the primary objective of which is to stimulate economic growth. These reforms could be a real game-changer if they succeed in creating new jobs, fuelling economic expansion, and making the U.S. more competitive - and dare I say it ...making America great again.
It is becoming more and more the "norm" in many areas of day-to-day life that in lieu of an original paper copy of a document being given to us during some form of transaction or interaction, the document is instead created and sent to us digitally. Consider for example car rental agreements, sales receipts, monthly phone bills, tickets to a concert or art exhibit, personal income tax returns, charitable donation receipts, etc. It's easy to get in the habit of receiving important documents in this manner, as well as relying on having them at our fingertips and readily available by quickly searching phones, tablets, PCs, external hard drives, cloud storage and email inbox folders, or even accessing these documents online and downloading them if and when needed.