As a supporter of BC Women’s Health Foundation, we want to ensure you are aware of proposed changes to the Alternative Minimum Tax (AMT) slated to take effect January 1, 2024, which could have implications for your tax planning.
These changes, if passed at the federal level, could have a significant impact on certain types of charitable giving.
It is important to know that most individuals are not subject to AMT. Here are some points to consider on whether AMT may affect you:
- Individuals, trusts and estates with taxable income of $173K+
- Individuals who are interested in making tax-efficient donations through appreciated securities, stock options, or flow-through shares
If you are subject to AMT, here are some of the notable proposed changes:
- Adding 30% of capital gains on donations of publicly-listed securities, which under current rules are not subject to any tax
- For gifts of securities, the donation tax credit will be reduced to 50%, from 100%
- Increasing the capital gains inclusion rate from 80% to 100% for AMT purposes
- Including 100% of the benefit associated with employee stock options, which under current rules are taxed at 50%
- Increasing the federal AMT rate from 15% to 20.5%
As you plan your charitable giving for 2023 and years to come we want to offer you some options to consider if these changes may affect you.
- Contact your accountant and finacial advisors to understand how the changes to AMT may affect you and your philanthropic goals
- Consider accelerating your philanthropic plans prior to January 1, 2024, especially if you use appreciated securities, stock options, or flow-through shares as part of your donation strategy
- Consider creating a donor advised fund, so you can benefit from the 2023 tax rules and a 2023 tax receipt
For additional information on the proposed changes to AMT, please take a look at the following resources:
- What is the alternative minimum tax in Canada? | MNP
- Understanding_Proposed_Changes_to_Taxation_of_Charitable_Giving.pdf (leithwheeler.com)
- Budget 2023 and changes to the alternative minimum tax | Miller Thomson LLP
At BC Women’s Health Foundation, generous donor support enables us to fund cutting-edge research that improves patient outcomes, fund new capital projects and technology, provide world-class healthcare to women and newborns. None of this would be possible without the support of our incredible donors.
Thank you for your loyal support of BC Women’s Health Foundation. Your passion for improving healthcare is inspiring, and we are grateful for you.