Tips on tax, AgriInvest

I got two emails recently with pointers and tips you may find important. The first one came from the federal government's AgriInvest program. This is the program where you make a deposit, which represents a percentage of your sales, and the government will match your deposit. You can withdraw this money at any time. Mark Sloane and Andrew DeRuyck will have some pointers for you in their column in the January 11 Grainews. In the meantime, here are some important deadline reminders.

AgriInvest deadlines

Earlier this fall, farmers received a 2008 AgriInvest Deposit Notice with information on your maximum matchable deposit, how to make a deposit in order to have the government contribution deposited to a participant’s account, and how to access funds from the AgriInvest account.

You must make a deposit to receive the matching government contribution, and you have 90 days from the date of their 2008 AgriInvest Deposit Notice to make a deposit. The deposit deadline is located in the top right hand corner of the Deposit Notice and on the tear off portion of the form.

If your deposit is not received by the deadline indicated on your Deposit Notice, you will not receive 2008 AgriInvest benefits.

If you have not applied: The deadline to submit an AgriInvest form is September 30, 2009. Applications postmarked after September 30, 2009 up to and including December 31, 2009 will be subject to a five per cent per month reduction in the maximum matchable deposit. Applications postmarked after December 31, 2009 will not be accepted. Applications are available through the AgriInvest website or by calling the administration toll free at 1-866-367-8506. Call this same number if you have any other questions.

Tax tips from H&R Block

You might find a few useful reminders among these tips, which I've lifted verbatim from the H&R Block news release.

• Home Renovation Tax Credit: The deadline is January 31, 2010. Canadian home and condo owners can get up to $1,350 back on lasting or integral renovations. If you are going to do it yourself, make sure you buy your materials before the deadline. If you hiring a contractor, be sure the work is completed before the deadline.

• Review your stock portfolio. The markets did gain some ground in 2009 but many people are still facing capital losses on their investments. It is a smart strategy to review your portfolio before the year end to see if you can find a tax advantage in taking a loss or cashing in a gain. Capital losses can be carried back three years or carried forward indefinitely.

• Employment Insurance (EI) Benefits: Stats Canada estimates more than 800,000 Canadians collected EI this year. For taxpayers collecting EI, they may want to review their tax obligations before the end of the year. In most cases, EI only withholds 10 percent back for tax purposes which is less than the lowest tax bracket. If the taxpayer collecting EI earned any other income in 2009, they could be facing a tax bill when they prepare their return next year.

• Saving for Higher Education: With tuition costs rising, many parents and grandparents want to take advantage of the government’s Canada Education Savings Grant (CESG). You must make a contribution to your child’s Registered Education Savings Plan (RESP) before December 31. The lifetime RESP contribution limit is $50,000 with no annual contribution limit. CESG matching contribution per year has been increased from $400 to $500.

• Pooling medical expenses: If you have an expensive trip to the dentist coming up, you may want to consult a calendar. Medical expenses can be claimed in any 12-month period ending in 2009 so it could be beneficial to try to fit known medical expenses into the same 12-month period in order to maximize your claim. You don’t actually have to go to the dentist but if you have an outstanding amount, try to pay the bill by the end of the year. Remember, medical expenses are reduced by a percentage of your income. So the greater their dollar value, the likelier it will be that you can make a claim.

• Making a difference: If you want to claim a charitable donation on your 2009 tax return, you have to make it before December 31. If you have already made more than $200 in donations in 2009 it will also be worth a 29 percent federal credit instead of the 15 percent for donations under $200. The good news is that now you can donate publicly-listed securities to registered charities or private foundations without being subject to capital gain taxes.

• Moving to start a job in a different province? Check the provincial tax rates before deciding the moving day. You are subject to provincial tax in the province where you reside on December 31. So if there is a substantial difference in the tax rates, you may want to either speed up or defer the move.

• Getting married? You file your taxes based on your marital status on December 31. So if you want to claim your new spouse as a dependent on your 2009 return, you can claim them for the full year even if you are married on New Year’s Eve. Just make sure you say your vows before midnight.