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Three Smart Levers to Cut Your 2025 Tax Bill

Taxes are inevitable, but overpaying them isn’t. With new rules and opportunities in 2025, smart planning can help you keep more of your hard-earned money. Here are three effective levers to reduce your tax liability this year: 1. Maximize Retirement Contributions Contributing to retirement accounts such as RRSPs (Canada) or 401(k)/IRAs (U.S.) remains one of the most effective ways to lower taxable income. Contributions qualify for tax relief at your highest marginal rate, meaning every dollar you save reduces your tax bill significantly. Employer-matching programs make this even more attractive, and withdrawals in retirement can be structured for lower tax exposure. 2. Leverage Tax Credits and Deductions Common deductions include childcare expenses, education costs, and home office claims. Tax credits, unlike deductions, directly reduce the amount you owe, making them especially valuable. Temporary tax breaks introduced in 2025 can be maximized before they expire. 3. Use...
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Ontario’s 2024 Budget: A Balancing Act Amid Challenges

 

The Ontario government has unveiled its 2024-25 budget, navigating a complex landscape of economic shifts, inflation, and rising deficits. Here are the key highlights:

  1. Deficits Rising, Yet a Path to Balance:

    • The projected deficit for the coming year is nearly double the previous estimate, reaching $9.8 billion from the initial prediction of $5.3 billion.
    • Despite this, the budget outlines a gradual reduction, with a deficit of $4.6 billion in 2025-26 and a surplus of $500 million by 2026-27, coinciding with the next provincial election.
    • Factors driving the deficit include slower growth, infrastructure investment needs, and an extended cut to the province’s gasoline tax.
    • The government also had to allocate billions for backpay to public-sector workers after a legal battle over wage caps.

  2. Municipalities and Infrastructure:

    • The 2024 budget prioritizes funding for Ontario’s 444 municipalities.
    • A $1-billion program aims to facilitate housing construction, addressing resource shortages for roads and pipes.
    • An additional $625 million fund targets water systems, supporting housing development.

  3. Health Care Investments:

    • Ontario commits to spending billions more on health care:
      • $2 billion over three years to expand home care access and enhance compensation for personal support workers and nurses.
      • Nearly $1 billion additional funding for hospitals in 2024-25.
      • $546 million over three years to link 600,000 people with primary care teams.
      • $152 million for stable housing for individuals with mental health conditions and addictions.
    • The government also announces a new medical school in Vaughan, affiliated with York University, focusing on training family doctors.

  4. Auto Insurance Reforms:

    • Drivers gain more flexibility:
      • While mandatory coverage remains for medical, rehabilitation, and attendant care benefits, other benefits become optional.
      • Auto insurance companies will cover medical and rehabilitation costs before extended health care plans.
      • The goal is to reduce paperwork and provide affordable options for Ontarians.

  5. Balancing Priorities:

    • Despite rising deficits, the government remains committed to building infrastructure, enhancing services, and avoiding tax or fee increases.
    • Ontario’s journey toward fiscal balance continues, with challenges and opportunities on the horizon.

In summary, Ontario’s 2024 budget reflects a delicate balancing act, addressing critical needs while navigating economic complexities. The province aims to build a better future, even as deficits loom large. 

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