Tax Planning Opportunities
There are several tax planning opportunities available to farmers in Saskatchewan with respect to the land they’ve owned and worked over the years. Many of these opportunities become available upon death and relate to Income Tax Act provisions allowing for the transfer of property to a family member. To be prepared to take advantage of any tax benefits available. It would be prudent to have available the following information to your tax professionals in preparing the final return and subsequent estate filings.
Farm Land Checklist
History of each parcel of land owned including:
- Year of acquisition and cost of acquisition.
- If acquired via inheritance on death, copy of final return from the date of death of the bequestor or value at bequestors date of death.
- If acquired before 1971, the fair market value of each property on December 31, 1971. If available, formal 1971 valuation report.
- Details on whether 1994 Capital Gains Election was utilized. If available, copy of 1994 personal tax return including form T664
- Name and relation (if any) of any previous owners.
- Years actively farmed on each parcel vs. Rented out.
The more of these documents that can be accumulated before your passing, the easier it will be for those administering your estate. It will also offer better protection against further CRA audit or review, and ensure the maximum value transfer to future generations.
Farmland Information Checklist
If you have further questions about farmland or your farming operation, we encourage you to reach out to one of the many agriculture and tax experts of Virtus Group, available at 306-522-6500 (Regina) or 306-653-6100 (Saskatoon).