5 tax changes to watch out for in the upcoming federal budget

financialpost.com:

What could be in the federal budget that Finance Minister Chrystia Freeland is delivering on April 16? It’s really anyone’s guess, but some insights can be gleaned from the government’s recent pre-budget report, as well as from various pre-budget industry newsletters, each offering up their own predictions and recommendations of what might be in store.

Let’s review some potential tax changes we could see next month.

Among the 359 recommendations contained within the Standing Committee on Finance’s 344-page report is that before proceeding with the proposed changes to the Alternative Minimum Tax, the government should determine the impact these changes will have on charitable revenues by conducting an independent economic and financial analysis.

The AMT imposes a minimum level of tax on taxpayers who claim certain deductions, exemptions or credits to reduce the tax they owe to very low levels. In last year’s federal budget, the government announced that “to better target the AMT to high-income individuals,” several changes would be made to the rules for calculating the AMT, beginning in 2024.

The changes, which were formally introduced in Parliament last summer, but have not yet been passed into law, include raising the AMT rate to 20.5 per cent from 15 per cent, increasing the amount of income below which AMT will not apply ($173,205 in 2024) and broadening the AMT base by limiting more amounts that reduce taxes. All provinces and territories also impose AMT, which is generally calculated as a percentage of the federal AMT.

Since AMT can only arise in 2024 if your income calculated under the rules exceeds the $173,205 AMT exemption, most taxpayers don’t have to worry about it. But AMT can be an issue for higher-income