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  #11  
Old 02-06-2019, 11:17 AM
Jim Becker Jim Becker is offline
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Russell, recent changes to tax law have made using a HELOC less attractive, at least from a personal tax perspective. It may also present a conflict for a business situation and an accountant should be consulted accordingly just as with any other form of finance for a business.
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  #12  
Old 02-06-2019, 11:27 AM
drummerjg drummerjg is offline
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Jim is correct on the HELOC. Be careful trying to use it for other than main home modifications and trying to deduct the interest. The Tax Cuts and Jobs Act of 2017, enacted Dec. 22, suspends from 2018 until 2026 the deduction for interest paid on home equity loans and lines of credit, unless they are used to buy, build or substantially improve the taxpayer’s home that secures the loan. I don't think buying a CNC will qualify.
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  #13  
Old 02-06-2019, 11:54 AM
rcrawford rcrawford is offline
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Yes, things are certainly different in Canada. We are not able to deduct any interest for mortgages or HELOCs in Canada, like you do in the US.

But, if your business is borrowing money from your personal HELOC, you are essentially 'borrowing' personal money for the business. In this case, your business can deduct the interest that it pays to you, which you are paying to the bank.

You do need to pass this through an accountant, of course. But it is often cheaper than getting a small business loan.
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  #14  
Old 02-06-2019, 04:34 PM
John B John B is offline
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Default Rebuttal to Mr. Mwangi

Mr Mwangi

Since you took my entire post and explained how it does or doesn't apply to CAMaster, it would only be fair that you would have included the very first thing I said...which I repeat below:

"Without presuming to judge Camaster and without assuming that any of this actually applies to them (and "Camaster financing"), you need to understand the following about "in house financing"."
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  #15  
Old 02-06-2019, 04:42 PM
Fixedwing Fixedwing is offline
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Wow, you guys are awesome.

I actually am reaching out to a credit union I use and they have been responsive. The rates are actually very reasonable and this is coming from someone who hates to pay any type of interest. No approval yet, but things are positive.

One thing I personally feel is important is building my business credit, but the options listed above will be considered if an equipment loan is not feasible.

Thanks for the advice and input.
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  #16  
Old 02-06-2019, 04:46 PM
John B John B is offline
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Quote:
Originally Posted by rcrawford View Post
Yes, things are certainly different in Canada. We are not able to deduct any interest for mortgages or HELOCs in Canada, like you do in the US.

But, if your business is borrowing money from your personal HELOC, you are essentially 'borrowing' personal money for the business. In this case, your business can deduct the interest that it pays to you, which you are paying to the bank.

You do need to pass this through an accountant, of course. But it is often cheaper than getting a small business loan.
You're forgetting that you will pay tax on the income from the interest that your business pays to you. This whole HELOC issue has been previously addressed in another thread...Search for "HELOC' within this forum.
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  #17  
Old 02-07-2019, 08:34 AM
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Thomas Mwangi Thomas Mwangi is offline
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Quote:
Originally Posted by John B View Post
Mr Mwangi

Since you took my entire post and explained how it does or doesn't apply to CAMaster, it would only be fair that you would have included the very first thing I said...which I repeat below:

"Without presuming to judge Camaster and without assuming that any of this actually applies to them (and "Camaster financing"), you need to understand the following about "in house financing"."
John,

You are correct.
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  #18  
Old 02-07-2019, 08:53 AM
rcrawford rcrawford is offline
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Quote:
Originally Posted by John B View Post
You're forgetting that you will pay tax on the income from the interest that your business pays to you. This whole HELOC issue has been previously addressed in another thread...Search for "HELOC' within this forum.
I guess things are much simpler in Canada!

I use my personal HELOC for business all the time up here for large purchases (because its free, whereas a business line of credit has a monthly fee whether I use it or not). I just tie the HELOC to my business account so the interest and principle payments come straight from there. Nothing could be easier.

If it screws up your taxes, or creates an accounting nightmare, I agree it is easier to just get a loan.
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  #19  
Old 02-07-2019, 09:19 AM
T.R.MacMunn T.R.MacMunn is offline
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I do the same as Russell, although I rarely use mine anymore.
Canada Revenue Agency doesn't care where you borrow the money from. If it's paid directly out of your business acct., it's much less paperwork.
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