File A Tax Return For Your Teenager

Your teenager earns nothing so logically you do not need to file a tax return. Right? Not so fast.

We discussed in previous posts why the Registered Disability Savings Plan (RDSP) is the best way to save for your child’s future. The key element to the plan is the government grants and bonds (free money!) which is added to the account. The amount added is dependent on the family income.

If the beneficiary of the RDSP is over the age of 18, the “family net income” used to calculate the government grants/bonds is that of the beneficiary and his/her spouse. The income that will determine the grant and bond is based on the income tax return from the second preceding year. (Example: Contribution made in 2019 – net income based on the 2017 tax year.)

In other words, to ensure your child receives the maximum entitled grant and bond, file a tax return when he/she turns 17 (even though the income may be low or even non-existent) so that the grant and bond will be based on his/her low income status.

RDSP Statement of Grant Entitlement

Soon you will receive your annual Registered Disability Savings Plan (RDSP) Statement of Grant Entitlement in the mail. For those of us too tired to calculate our annual contributions, the government does it for us. Of course this assume that you have an RDSP in the first place. For those of you who do not have an RDSP, I ask why not? Are you new to the world of autism or do you not like receiving free money from the government?

The RDSP letter will show what contribution you need to make to attract the maximum grant and/or bond for 2019.

I love to hate the government, but this really is a nice touch. They are all but begging to give you money.  

You could deposit more money than required to attract the maximum grant, but for most families I recommend limiting their contributions. There is a lifetime maximum contribution limit and once that is filled, there can be no further government grants.  

You can get more information about the RDSP from my website or RDSP.com.

My 2018 RDSP Report Card

Last year, my son’s Registered Disability Savings Plan (RDSP) had a rate of return of -2.2%.

Is that bad?

No, not really. In fact it’s in line with the industry benchmark. My portfolio is based on the Canadian Couch Potato TD e-Series model portfolio . Last year, the model portfolio returned -2.1%.

It’s important to look at the long term picture. We opened the RDSP in 2013. The rate of return from then to the end of 2018 is 5.5%.

And we care because……?

The point is that anyone can manage RDSP investments without paying for a financial advisor or having any investment knowledge. All you have to do is setup a low cost portfolio (such as the one linked above), add money every year, let the government add the grants and bonds and in the long run, you will be well ahead of those who pay too much for financial advice.

How to get an iPad when you can’t afford it

How  many of you tried to buy an iPad (or other expensive device) using the 20% equipment budget from your BC Autism Funding? You had to:

  • Send in a Justification Form signed by your Consultant
  • Wait for approval
  • Buy the device
  • Submit a Reimbursement for Autism Expenses form
  • Wait for the funds from the BC government

That’s fine for those who can afford to pay upfront and wait for reimbursement, but it leaves the others in a Catch 22 situation.  The result is that the families who most need the device simply can’t purchase it.

Now there is a solution using London Drugs throughout B.C. You will need to follow these steps:

  • Get your Consultant to fill out a Justification for Equipment (JFE) form specifying the model number from London Drugs.
  • Send the form to the Autism Funding Unit (AFU).
  • Wait for the AFU to send a confirmation letter.
  • Fill out the RTP – Service Providers/Suppliers form.
  • Take the RTP and authorization letter to London Drugs and try to find a manager who knows about this program. You may have to try different locations or call London Drugs headquarters for help.
  • The manager will fill out Part B of the form and send it to the AFU.
  • The family will get a message that their computer/iPad is ready for pick up.

I have been told that the entire process will take about three months. If you have difficulty finding a London Drugs store that understands the process, I understand the Cloverdale and South Surrey stores are very accommodating.

Note that the AFU will only allow you to get a new device once every three years.  You can also expect push back if the device you select is too expensive (at least according to the AFU). How much is too expensive?  That is a good question and one that I don’t have an answer to.

Also, please do not use school as a reason for buying the device as the AFU will not approve this.  Your Consultant should be aware of the appropriate words to use.

OK, so that is all a bit exhausting and time consuming, but at least there is now an option for those that need it.

 

10 Years On

Ten years ago, I created a simple website to share my experience with other parents.  I had one aim; show you how the heck to pay for autism therapy without sounding like a bureaucrat.

Nobody else wants to make this easy for you.  We have governments, school districts and bureaucrats who continually create more paperwork and barriers for you, the parent on the front line.

No my child doesn't look

What has changed?

We now have a website!!!  The AFU now has an online portal.  Yippee!

What hasn’t changed?

The money.  We had one minor increase in BC autism funding in 2010. Meanwhile the government is content to ignore inflation and minimum wage increases each year, leaving our children with a smaller piece of the pie. The good people at AutismBC did some research and found the $6,000 funding from 2002 would now need to be $8,017 to address inflation.  The $20,000 funding from 2002 needs to be $29,400 (rather than the current $22,000) to keep pace with inflation.

It doesn’t seem to matter which party is in power in Victoria.  They feel our pain and show their outrage while in opposition and then do nothing when they are in power.

Has anything good happened?

The heartless Harper government gave us the Registered Disability Savings Plan (RDSP) which is seriously the best thing that has ever happened for your child’s financial future. If you don’t have one, please check it out at the earliest possible opportunity. If you don’t have anything in your bank account, don’t worry as the government wants to give you free money.

Meanwhile, the caring Trudeau government is sitting on a policy resolution passed two years ago by their own party members to include science based treatment under Medicare. The resolution can be read here.  Please contact your Federal Member of Parliament and ask why this resolution is being ignored.

What is happening at ASDfunding.com?

The site has gone through 2 major redesigns, an online comment section has been added and the site is now friendly for handheld devices. Meanwhile I continue to receive many emails from parents telling me about their experiences.  I can’t begin to tell you how much this is appreciated as I use all the information to refine the website and keep it relevant for parents new to the world of autism.

Thank you for your continued support.  May the next ten years show more progress than the past decade.

Milburn

Finally! Online Access to the AFU

Families have been complaining for years that they did not have timely access to their child’s autism funding.  Some unscrupulous therapists have taken advantage of this fact to extract more funding than the families intended.

The Autism Funding Unit (AFU) has now joined the 21st century. Finally, families can:

  • View and manage their child’s funding
  • View and edit approved authorizations and
  • Submit forms online

The procedure to sign up is only slightly painful.

  • First, you need to sign up for a Basic BCeID 
  • Ensure the parent signing up has signing authority for the autism funding
  • Next, sign up for My Family Services
  • After the AFU gives their approval, you will be able to log into My Family Services.

On the My Family Services dashboard, you will be able to access and manage your child’s autism funding.

The Canada Caregiver Amount

The Family Caregiver Amount has now been incorporated into the Canada Caregiver Amount. It is a good move on the part of the feds as it was an admittedly confusing credit. The different names led people to wonder if they should claim more than one caregiver credit.

The Canada Caregiver Amount is for people who have a spouse or common-law partner, or a dependant with an impairment in physical or mental functions. They now share a common name but you will claim the credit on different lines in your tax return:

For your spouse or common-law partner, you may be entitled to claim an amount of $2,150 in the calculation of line 303. You could also claim an amount up to a maximum of $6,883 on line 304.

For an eligible dependant 18 years of age or older, you may be entitled to claim an amount of $2,150 in the calculation of line 305. You could also claim an amount up to a maximum of $6,883 on line 304.

For an eligible dependant under 18 years of age at the end of the year, you may be entitled to claim an amount of $2,150 on line 367 or in the calculation of line 305.

If you have more than one child with an impairment in mental or physical functions, you may claim $2,150 for each of them.

Note that unlike other credits discussed on this site, you do not necessarily need an approved T2201 Disability Tax Credit Certificate to claim this.

You must have a signed statement from a medical doctor showing when the impairment began and what the duration of the impairment is expected to be. For children under 18 years of age, the statement should also show that the child, because of an impairment in physical or mental functions, is dependent on others for an indefinite duration. This dependence means they need much more assistance for their personal needs and care compared to children of the same age. For your convenience, there is a sample letter on my Files page, which you can complete before the doctor’s appointment and present to him/her for a signature.

A doctor’s letter is not required if the child has an approved Form T2201 Disability Tax Credit Certificate from the CRA for the specified period.