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Inheritance Strategies

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The inheritance (expected sometime in the future) can be handled in two ways.

The simplest way is to assume that the funds from the inheritance will be invested in nonregistered (tax-accrued) capital.

("I'm putting my inheritance in a big fat GIC!")


This is the most straightforward method....

Go to the 'non txble deposit' column in the data entry grid. Move down to the year at which the investment is expected.... and Click.

A prompt will appear (value to insert). Enter the amount of the expected inheritance, remember this is not taxable.

That's all there is to it. Now, when you compute/amortize/smooth, these funds will automatically be incorporated in the smoothing math.


Now, what if your plan for those inheritance dollars was to buy a summer home or a revenue property or some equities?

In this case, we create a DCG (deferred capital entity) OUT IN TIME.

To do this, go to the DCG section (middle section of the Capital Frame). If you already have a DCG, advance ('next') to an empty one and

-enter the amount of the investment in the ACB.

-next, enter the age at which the inheritance is expected in the first 'date' field ('starts')

-and finally, enter the 'start' and 'end' values... the time period at which the proposed equity investment is expected to be realized/capitalized.

If it is planned that the investment is to be held and passed to your kids, enter 95/95.


Of course, the inheritance could be split between that GIC, summer home and a big party. RRIFmetic allows any flexibility. For a $300,000 inheritance, put 100K in 'non txble deposit', 100K in a DCG and assume the remainder gets eaten up in a big-time wake.

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