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RE4 - The Canadin Champion, Tuesday, Apnl 7, 1998 c Revamped programs bring home ownership within reac Saving for a first home is neyer easy. If you're in the market tu buy, you know that accumulating a down payment requires a greatj deal of diligence, patience and planning. If you know ymu can hrtîdle rortgage p îy ments with case- but the down payment is the only thing that's holding you back, you may want to take advantage of the receotly extended RRSP Home Buyers' Plan. Revamped for irat- ime buyers only, the federal plan lets individu- aIs withdraw up to $20,000 of their RRSPs, sax free, tu use towards the down payment. Or if you're in no rush to buy, you may want to take advantage of the Ontario Home Ownership Savings Plan (OHOSP). This provincial plan was also recently extended and revamped, allowing firt-time buyers to tuck away savingo towards the down payment on a home, while receiving annual tax credits nI up lu $500 per individual and $1000 per couple. Details of both of these inceotive programs are outlined blow. RRSP Home Buyers' Plan The new, moditied RRSP Hume Buyers' Plan allows you to withdraw up lu $20,000 from your RRSPs ($40.000 per couple) to purchase or build a home. No income tax is deducted from these funds, as long as they're repaid to an RRSP according to the government's repay- ment sehedule. The program bas helped thousands of Canadians attain the dream of home owner- ship- many who would nul have been able to make a purchase without il. You cao take advantage of the plan if neither yn 11u ilirsOUI sptahasve ownoil t homre îand lived in il as your principal place ot residence in any of the five calendar years before the ime of withdrawal. However, keep in mmnd that you cao only participate in the plan once. Once you enter into an agreement lu buy or build a qualifying home, you may withdraw funds from your RRSP, but you must acquire the home before October of the year following the year in which you made the wiîhdrawal. For example, if you withdrew funds in 1994, you would have tu complete ytsur purehasc before October 1995. How it Works Once you enter an agreement Io buy or build a home, you'll have go complete a special fomni (T1036) which is available at Revenue Canada district offices. This forru should then be sub- mitîed Io the financial institutioîn which holds your RRSP. Keep iii mmd that you cani wiîhdraw money from your RRSP îax-free if' the money was deposited aI least 90 days prior to withdrawal. The home you buy must be your principal place of residence withio one year after buying or building il. The home must also be acquired not mure than 30 days before receiving the withdrawal under the RRSP Home Buyers' Plan. Repayment Schedule '10 rot ùnii îo tsîeorîi Ial i ,- , I tt you wthidrais toiusl be repaid over a period of 15 years. 'ou cao opt lu pay less than your scheduled annual payments, but the amount you don't repay must be reported as income on your tax retum for that year. The repaymenls have to be mnade before December 31 of each year- but the repayment period begins the second year following the year in which the withdrawal was made. So, if' you took fuods out topurchase a home in 1994, ytsu would have 10 niake your first paymenl by the end of 1996. (The repayments dont( have to be made to the same RRSP you withdrew f'unds from.) Also keep in oind that you don't gel a second tax break whien you rnake an annual paymienl. so you' Il have bo inforni yîur RRSP issuer that your repaymenl isol a regular RRSP contribu- tion. RRSP repayment forms are available fromn any Revenue Canada district office. OHOSP The Ontario Home tiwnership Savings Plan s another valuable bool in saviog lfor a down payment. Since the plan was first iotroduced six years ago, some 350,000 plans have been opened and more than 200,000 people have used il to buy homes. If was recently entended by the provincial govemnment to run indetinitely. However, it was revamped so that only tax credits are allowed; lhore are no longer ar0v exsemptions ltIse I and December 31, 1993. Eligibility in OHOSP is determincd by family income. You can participate as an individual if your annual net income is leso than $40000- or if you and your spouse have a combincd net incomc of less than $80,000. Although theres no limit to the amnounit you can contribute, your tax credit entitlement is based on contributions of not more than $2,000 per person or $41100) per couple, per year. Keep in immd that you have a limited ime to take advantage of the program. Check witb your financtal institution f'or more details. To invest in an OIIOSP. simiply complete an OHOSP applicatiotn lorm at any parlîeipatiîng financial institution and deposti funds mb tIste plats. You can only open one OHOSP. Il you're interested in taking advantage of cithier one ot' these plans, a real estate protes- sional can belp you understand how îhey work and ensure that you maximize their benetits. J Tihis article fispnovidcd b6vý local rea/tors ond t/te Onttorio Real Estote Association (OREA)Jior theo beniefit of cosutnters intht/e real estate omarket. SUSAN RECOSKIE < Anderson Sae e. / M, 333-3222 Im "ESCARPMENT" $495,000 LOCATION, LOCATION, LOCATION! 19.54 acres of Park like seaîing wiîh magnlicent views to the south. Large family home inclades 4 bdrms, 3 bathrooms, oak kit. wth baili-ins, oak crcular staircase to finished grnd tr, which would b ideal for an in-law saie. Caîl SUSAN RECOSKIE Sales Rep ai 333-3222. REALTY WORLD MILLPOND REALTY INC., REALTOR 189 mafi St. E., miltceî naam a 90SI8 76-0633 Surf the Net - (Emal us your comments and requests.) http://www.inillpond.on.ca. RENTAS Avalabs »à