The Rural Voice, 1986-10, Page 58ATTENTION
ALL OWNERS OF
Wzraitita.
PowslcTaaLa
Culliton Brothers Limited are pleased to announce that
they have been chosen as the authorized
POWER TOOL
Service & Warranty Repair Centre For Perth and Huron Counties
FREE
LABOUR ON ALL MAKITA
ELECTRIC POWER TOOL REPAIRS
(Sept. 22186 • Oct. 31186)
Gullitons
Quality & Service At A Good Price For Over 50 Years
473 Douro St. Stratford 271.1981
BUY THE
BEST.
We have the most competitive prices ever on the best
snowblowers we've ever built.
CALL US TODAY FOR ALL THE DETAILS
N.E. HAGEDORN ft SONS LIMITED
PAISLEY 519.353.5240 Evenings BOB 519.353.5876
56 THE RURAL VOICE
ADVICE
TAX FREE
UNTIL 1987
Until the end of 1987, full-time
farmers have a unique opportunity
to pass along their farms to their
children with a full or very con-
siderable exemption on capital
gains tax.
There are two major capital
gains exemptions. One is the
lifetime exemption on up to
$500,000 of capital gains, in-
troduced in Minister of Finance
Michael Wilson's first budget in
1985.
Unlike other types of capital
gains, which are being phased in
until the full amount is in effect in
1990, the full $500,000 may be
claimed right away on any sale of
all or part of a farm, an interest in
a farm, a farm partnership, or
shares of a family farm corpora-
tion. This exemption is available
whether the farm is sold to a
farmer's children or to outsiders.
After the farm is passed along,
the new owner becomes eligible to
use it for his $500,000 exemption
on any gain during his period of
ownership.
The other exemption —
available before Michael Wilson's
budget — is for shares in what is
called a small-business corporation
and for farms, whether incor-
porated or not. This exemption
provides for another $200,000, but
it's being phased out at the end of
1987. Upon the sale of farm pro-
perty to a farmer's children, up to
$200,000 of any gain may be defer-
red and shifted to the children. On-
ly a farm operated by the farmer,
the spouse, or the children at the
time of transfer is eligible, and the
deferral is available only if the
farm is going to the children.
So, if a farmer is passing along
the farm to his children, the ex-
emption may be up to $700,000,
except when the farmer's spouse
also owns shares or farms in part-
nership — then the exemption can
be up to $1.4 million.
What's more, a farmer does not
actually have to stop farming to
realize the gain. He can sell or give
some of the land to his children so
that they can start their own opera-
tions, and he can keep right on
farming.
Added to the time constraints on