I've been a bit of a numbers geek for as long as I remember. I not only did math problems for fun in workbooks my parents bought me, but I loved to earn money and put it into my bank account. I bought what I needed, and sometimes what I wanted, donated some, and the rest went into my savings account.
Nowadays, as not only a mom, but as a Chartered Accountant, I've been pretty diligent about teaching my kids what I've learned in my life to help them be financially literate. My kids attend "Money and Me" sessions at our church where they learn that you need to work in order to get paid, and that not all jobs pay the same amount.
There are two things that are certain in life: death and taxes. We're not dead yet (yay!) so we have to deal with taxes. The great thing is, though, that as much as your kids may cost you one BILLION dollars over the course of their lives, there are also a whole lot of ways that you can turn those little bank account drainers into tax write-offs.
I am no longer in public practice, so I have to buy a tax program every year and I use TurboTax. While I know all of the T1 schedules by heart from over a decade in public practice, it's kind of nice to let the program walk you through all the right questions to ensure you receive every tax deduction and credit my family deserves. Then at the end there's a final review to make sure everything is completed properly. Easy, peasy.
TurboTax is something I use personally, and professionally, and it's what I recommend to friends and family when doing their own taxes. I may know my tax stuff, but TurboTax offers people access to tax support and advice via phone, online chat, email, Facebook and Twitter, on their own terms and time. The longer I'm out of public practice, the more I'll probably reach out to them with questions myself.
We still have a few weeks before the May 5, 2014 filing deadline. So, let's do this. Here are my tips on how to turn your kids into tax write-offs—you guys need to know this stuff.
A new parent could qualify for the Child Tax Benefit, which is a tax free payment. The amount depends on where you live and your marital status.
The Children's Fitness Tax Credit lets parents claim up to $500 per year for eligible fitness expenses paid for each child who is under 16 years of age at the beginning of the year in which the expenses are paid.
Here's a stat for you:10 per cent of Canadians who have filed their taxes using TurboTax have claimed the Children’s Fitness Tax Credit.
The Children's Arts Tax Credit is for programs in fine arts, music, performing arts, outdoor wilderness training, learning a language, studying a culture, and tutoring.
Parents can claim up to $500 in eligible fees (you get 15 per cent or $75).
Caveat: You may not claim associated travel, meals, and accommodation. You may not claim fees paid for a program if the instructor or leader is either someone under 18 or the spouse or partner of the parent making the claim.
Here's another stat for you:4 per cent of Canadians who have filed their taxes using TurboTax have claimed the Children’s Art Tax credit.
The Adoption Expense Tax Credit is new!
Canadians who adopt a child take on an enormous responsibility — not only in caring for their new child, but the financial responsibility as well. According to the Adoption Council of Canada, the cost of adopting a child can cost as much as $30,000.
This new credit allows an individual to claim a non-refundable credit on eligible adoption expenses (up to a maximum of $11,669 per child for 2013) in the taxation year in which the adoption period ends.
The credit is determined by multiplying the amount claimed by the lowest income tax rate (15 per cent for 2013).
We haven't adopted any kids, but we use the fitness tax credit (soccer and swimming) and the Arts credit (piano) and we get the Child Tax Benefit as well.
If you have any questions from the C.A. in the house, I'm all ears. Taxes aren't as scary as they're made out to be.
This mom puts TurboTax to the test. Find out if she credits this program for making this year’s tax return the easiest ever.
TurboTax by Intuit is Canada’s best-selling tax software for a reason. It guides you through a personalized experience to help you find every tax deduction and credit you deserve.
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As a Chartered Accountant, I'm pretty good with numbers. I kind of have to be in my line of work.
My knowledge of numbers flow into my personal life as well. I own a house (and a cabin at the ski hill), I have kids—who I put education money aside for and who seem to make me bleed money on a daily basis, we have two older vehicles that both decided to break down last month, and there are the daily costs of living that I deal with. Groceries, household bills, new jeans for the boy who always seems to blow holes in the knees.
I do a fairly decent job of budgeting and keeping track of everything, but some months it seems pretty overwhelming and some months I get behind and spend a lot of time playing catch-up. While my spreadsheets and accounting program do the job, I was pretty excited when I was asked if I wanted to try out the Life, By The Pie website and write about it from an accountant's point of view.
I watched the introduction video, which seemed like it was all about me!
You can see it here:
There's something about that pile of paper that needs to be dealt with that's just so intimidating.
When I read the "recipe" for their pie, it also resonated with me. I needed more direction, as much as I'm embarrassed to admit it. I'm a professional, so I should have it all figured out. The thing is, I'm also a human being who can be whimsical in her spending choices.
I know that my own finances have not reflected my new reality of being self-employed, and of the reality of having a husband on a pastor's salary. When he was a lumber broker in a high market time, money wasn't something we thought about. When I worked in public practice, money wasn't something we worried about.
We've scaled back a lot recently, but the tendency to buy what we "want" (as opposed to what we actually need) still rears its ugly head. We're keeping on top of our monthly bills, but sometimes it's to the wire. I needed this kick in the arse to track things as we go along instead of wincing when I opened bills to pay them. I tend to avoid stress at all costs, but finances are one where I avoid dealing with them. I then worry for weeks on end until I get caught up.
No more. It's time to be a grown-up.
The stress relief from tracking everything in real time is huge. HUGE. I knew it would be, and I'm happy for the nudge to do so.
If you want to take the stress out of managing your finances, you need to check out Life, By The Pie. There are a number of ways to learn how it works and start making it work for you.
There's also a book! It's called Life, By The Pie, written by co-founder & financial manager Michael Finkbeiner.
It's definitely worth it to check out, friends. And if you have any questions, feel free to ask.
Also (please) feel free to let me know that I'm not the only one who makes financial blunders, because I'm sure I'm not alone!
One of my very first posts at YMC, a year ago, was about when kids should join Facebook. There were so many great comments—over fifty—but then my Disqus account got set up and all of those comments were obliterated. In the age of no comments that was especially tragic, but I've carried on like the trooper that I am.
My eldest is still not on Facebook, but he does have an Instagram account. He's private, and will check with me about follower requests from people that he doesn't know. His younger brother and sister also set up a joint Instagram account, with the same parameters, and I think that's enough social media for all of them. They are friends with a few school friends and many aunts, uncles, and cousins. It's fun for me to see them interact with their friends and family on Instagram.
My eldest has occasionally asked about having a texting plan. He has my old iPhone to use as an iPod, and we've been able to text using wifi when it's available. The schools here have free wifi, but kids aren't allowed to have their devices in hand inside the school, which means that as soon as he's outside he can no longer access wifi.
When we're at our cabin, we're off the grid, except that my phone is set up to be an Internet hotspot. If we're all at the cabin and the kids stay at the cabin while my husband and I snow shoe, one of us will leave our phone so that we can check in with each other. There are times when only one of us is with the kids with only one phone plan, and I think it might be time to get our eldest a texting plan, at the minimum. Heck, he is legally able to babysit other kids.
It just seems like such a huge thing for someone who is eleven, but we live on an acreage ten minutes behind our wee town, and having the ability to text my son about changed after-school plans or from a hike at the hill would be great. I need to convince my Dutch (Read: FRUGAL) husband of this, so please help me out here.
Do your kids have cell phones? Talking plans? Texting plans? Notes in a bottle? Carrier-pigeons?