Syndicate
Law of Normalization for Donations to Minors
The new taxing law introduced drastic changes on the norms that regulated donations of financial assets to minors. The changes are directed to eliminate from the taxing laws certain lacks of (generational jumps” that will permit wealthy people to transfer its goods, no matter if they are acquired or inherited, with little or no taxing responsibility.
In what way does the law of normalization for donations to minors favor the small investors? It permits an investor to transfer funds; being it long term expansion investments, investments that have interest gains as for example the saving accounts or certificates of deposit; to minors. Although the new taxing law establishes a limit for the amounts that can be transferred to a minor, the truth is that such limitations won’t have a great impact on the average investor.
The incomes by interests and the capital gains have to be consigned on a tax declaration extended to the name of the minor, while the interest income that are not accrued will render at the parents fare if the minor has less than 14 years of age.
Which is the negative aspect of the law of normalization for donations to minors? Once the donation has been done to the minor, the operation can’t be undone. That’s right, the property of the funds oases from the adult to the minor. That is why, the parents before making a transference of this type, should be definitively sure that they aren’t going to need this goods in the future. Also, you have to be specially careful with these donations if you predict that the minor will some day need financial aid for studying; due that, in the assumption of him asking for a scholarship, the goods that are at his name will have a greater negative weigh than those owned by the parents.
Working On Its Own
There is a last aspect that many investors pass by when considering the different means that they have at their hands to protect their income from tax burden; this aspect is the possibility of setting up its own business.
We understand that to create a business and to give it all the necessary time is something very difficult, not to say almost impossible; now then, for many small investors the possibility of making a hobby into a lucrative activity on part time basis is an idea that is worth taking in consideration.
With the new taxing law, the fact of being ones own worker, even at partial times, supposes the enjoying of same advantages. Certain expenses related to the business are deductible, while that the income as an autonomous worker can be destine up to a 15% to a retirement plan that is also compatible with other plans you might have.
Talk, then, with your tax advisor about the possibility of turning into an autonomous worker.