The New Federal Budget Means “We May Need to Chat”

It’s important to stay in sync with important changes that impact your wealth, and tax changes are inevitable when it comes to new governments. The new federal budget has introduced a few changes that are relevant, and luckily, you have people to read and distill it for you (that’s us!).
There are two major developments that impact life insurance contracts, may affect you directly and warrant a conversation. Let’s take a quick look…
First, on March 22, 2016, the federal budget proposed to change the tax rule governing the transfer of ownership of a life insurance policy to a corporation. The change reduces the benefit that was previously available. With that in mind, if you transferred a life insurance policy into your corporation at any time, please contact us so that we can review your situation.

Second, effective on January 1, 2017, the tax rules governing all permanent life insurance policies will change significantly for the first time in 35 years. Of greatest importance is a reduction in the amount of cash value that can accumulate in policies purchased after January 1, 2017. If you want to take advantage of the current rules which allow for more tax-free cash value growth in a life insurance policy, please come in and see us. Policies in place prior to January 1, 2017 will be “grandfathered” and not be affected by the new tax rules. This is a time-limited opportunity.

While there was a lot more in the federal budget than this, these key items may have a real impact on you and your heirs. To see a more detailed review of the budget, take a look at the summary by CALU(Conference for Advanced Life Underwriting) in the attached link.
www.calu.com/securefiles/CALUSpecialReport/CALU_Special_Report-March_2016-final.pdf

We’re here to help, so feel free to reach out.