What You Do “Now” Can Protect Your Estate
Policies issued prior to January 1, 2017 will be grandfathered under the current tax rules. Preserving this status will be very important for policy owners due to these advantages:
- The cost of life insurance rates are to increase across the board
- Much less exempt room
- A revised definition of the exempt test, which limits the cash value a policy can accumulate
- ACBs will be higher and remain negative for longer- especially for older issue ages
- Disadvantages for corporate owned policies as CDA credits will become much lower
- Surrender charges will be impacted in all policy years
- Will need more face amount to shelter higher cash values
Now is the time to review your current financial situation, contact Scott Mallender today to review how Universal Life insurance can fit into your long term financial strategy.
Save Tax Before Life Insurance Tax Rules Change
Universal Life is an excellent tool in protecting your estate and accumulating tax free wealth. NOW is the time to take action. One of the last remaining tools for additional tax free growth is about to be drastically altered. This TFSA-like investment account offers a wide range of investment options, including fixed interest, equity options and managed accounts. Scott’s long term growth portfolio has averaged 11.8% tax free return over the last 3 years. Call today to review your insurance, whether term conversions or old whole life policies, now is the time to review.
Why Are the Life Rules Changing?
The Government of Canada has been planning changes to the life insurance tax rules for some time now. The current rules will be modernized and updated to accommodate and address significant changes to life insurance products which have developed over the years. The last time the Government of Canada made significant changes to these rules was 1982. These changes are meant to standardize all insurance companies.
Understanding the Tax Rules and What These Changes Mean
Policies issued prior to January 1, 2017 will be grandfathered under the current tax rules. Scott’s experience will be essential in preserving your Guaranteed Grandfathered status, which will be very important for policy owners. This impact is best described by the Chartered Professional Accountants of Canada.