Interest earned on these investments is not taxed. Through the Canada Education Savings Grant (CESG), the federal government matches annual RESP contributions by 20% if the the future students receiving the funds are 17 or younger. The CESG applies on the first $2,500 of annual contributions ...
Bond taxation is confusing and life is fleeting and so – double-quick – here’s what you need to know to keep on theright sideof the taxman: Bonds are not taxed the same as equities. Offshore bond funds are not taxed the same as onshore ones. (In other words, the treatment may ...
When considering a marginal tax rate versus an effective tax rate, bear in mind that the marginal tax rate refers to the highest tax bracket into which a person’s or company’s income falls. In the United States, an individual’s income is taxed at rates thatincrease as income hi...
Investing in atax-efficient mutual fund, especially for taxpayers who don’t have a tax-deferred or tax-free account, is another way to reduce tax liability. A tax-efficient mutual fund is taxed at a lower rate relative to other mutual funds. These funds typically generate lower rates of re...
However, students usually find themselves in one of the lower income brackets so this money is usually tax-free or taxed at a low rate. Can you transfer an RRSP to RESP? Technically, you could. But, there’s no good way to transfer money from an RRSP to an RESP. To do so, you ...
Always review the fees, flexibility, and details of any investment strategy, and remember there are many ways to generate income, including dividends, bond interest, annuities, or asset sales. Quality dividend stocks can be a reliable foundation for retirement income. They offer consistent payouts,...
How to save in your 20s The irony of retirement savings is that you need to start young. To fully enjoy the power ofcompound interestyou need to maximize the years you give yourself to save. By the end of your 20s,aim to have as much in your retirement accountsas you earn in a year...
The tax-equivalent yield is the return a taxable bond needs to equal the yield on a comparable tax-exempt bond, such as a municipal bond. A bond's interest income, called coupon payments, istaxed according to the type of bondand where it's issued. Coupon payments from a U.S. Treasury...
When a taxpayer converts a traditional IRA to a Roth IRA, income taxes are owed on the balance being transferred. It is added to the person's income tax bill for that year.7 Redeeming a U.S. Savings Bond The interest on U.S. savings bonds is subject to federal tax. The taxable eve...