Unable to enter 0% as my percentage of investment income reported on T5 in joint account

[taxmonkey468]

I have a joint account with my wife. When the account was opened, the bank listed my name first on the application, which is now interpreted as being the "primary owner" of the account for the purpose of reporting. So all the slips that were reported to CRA are assocated with my SIN and Turbotax imports these slips for me. So far so good.

The problem is that all the investments in this account were funded 100% by money my wife contributed from her inheritance. So based on CRA, all the income should be attributed to my wife, not me.

But Turbotax does not allow me to enter 0% as my percentage on the T5 slip screen. Any time I do this and save, the percenrage resets to 100%.  If I enter 0.01% the slip saves correctly ... but this is not accurate split of the income attribution (although is close).

How can I enter 0% and have it stick?

[TurboTaxSusan]

If your wife is going to claim 100% of the T5, then only put the T5 on her return.

[taxmonkey468]

Well, CRA associates all those T3/T5/T5008 slips with my SIN only, so when Turbotax imports all the slips, it associates these with me. So if you suggest reporting these on my wife's return, how can I transfer/ move the slips to her in Turbotax?

Or are you suggesting I delete all those imported slips under me, and manually re-enter them all for my wife?

[TurboTaxSusan]

Yes, you would have to delete all the under yourself, and manually re-enter them all for your wife, because you can't put in a 0% for yourself. And you can't import them to your wife's return if they are only in your CRA account.

Another possibility is to talk to the financial institution, see if they can switch her to the primary, and reissue the slips with her SIN. 

[taxmonkey468]

OK, Thanks ... I guess that is what I will have to do.

The financial institution will only report the T-slips against the SIN of the joint account primary owner (the first name that appears on the account). I asked.

What they suggested to change this was to open new joint account, with my wife as the primary, and transfer her contributions there. But this switch will trigger gains as far as CRA is concerned. I would have to basically sell everything in the old account (reported under my SIN) and buy it again in the new account (with the new book cost reported for her SIN).

The proportional reporting for joint accounts is a real pain. Turbotax should really allow my situation (entering 0% for me, because CRA has all the T-slips for my SIN), or allow imported slips to be associated with my wife not forcing me to re-enter everything.  Turbotax is already handling both returns at the same time, so this is really a missing function.

As a side comment, I have decided to "bite the bullet" and actually open the new joint account for my wife as primary, do the above "rollover dance" and basically do away with proportional income/gain reporting going forward (will have to do it one more time in 2024 because the "rollover" will happen this year). But then I am done for good. Both accounts will be JTWROS so when one spouse dies the other immediately takes over. There is no probate (accounts pass to survivor rather than estate). My wife's contribution go into one account (her primary, me secondary) and mine to the other (me primary, her secondary). No more proportional reporting, and everyones tax slips go to CRA with the correct SIN.

This would seem to work in my case (with spouses), but may not for other joint account arrangements. I am not a legal/ tax professional, so ask someone who can give advice, especially about "bare trust" and "presumptive trust" rules.

[LBP_tax]

I have the exact same issue. Turbotax will not allow me to enter a zero in the "your percentage" field. As a workaround, you are able to enter 0.01%. It's not perfect, but saves re-entering all the data or calling your financial institution and changing/opening a new account

[wendy43]

This is what I did for 2022, did not report it on my end.  It's reported on the other party who helds 100%.   

Guess what..government contacted me said I didn't report the amount.  it happens not just the T5 but another income (can't remember which form now).  government said I owe them taxes.  I am too busy to deal with it , I need to pay that "owing" b4 the deadline then I need to contact the government after filing my 2023. 

Turbo tax should fix this to allow putting in zero percent so the government audit can see it's reported somewhere else.   I suspect this will come back to me again some time this year or next year.

[gump]

I would hesitate deleting a T5 from your tax return if the primary SIN is yours. I always split my parents' T5 slips but when I did, CRA asked why my Dad wasn't reporting the full amount in the T5s/T3s (although a 2 minute check into my Mum's same year return would show the combined full amount).

I haven't responded to the CRA and now my 93 year old Dad got re-assessed. Argh.

[TurboTaxGinette]

Thank you for this update. Your feedback is informative and appreciated.

Thank you for choosing TurboTax.

[taxmonkey468]

Since I started this thread, I thought I'd add a minor update and my thoughts on this whole topic.

Whether TurboTax ever supports the ability to claim 0%, the real issue is that tracking the CRA "proportional income attribution" for joint investment accounts is a real pain-in-the-butt. Especially if the relative proportions change across tax years. It causes work for you (tracking the changes and maintaining "proof"), and your work is rewarded by CRA with unnecessary queries/ follow ups/ re-assessments/ audits as proportions change. 

As stated in my original response, I decided to "fix" this by openning pairs of joint accounts at each of the financial institutions we deal with (2 in my case, so 4 joint accounts). At each institution, we have one joint account with me as primary, and one with my wife as primary. It did not cost me anything (other than explaining to them why I was doing this). The financial institutions transferred the relevant investments in-kind so there were no capital gains/ losses triggered (in my original post above I thought I would have to sell and re-buy to do this). So was more-or-less effortless and solves this issue going forward.

My wife and I just direct investment money to the right account based on who is contributing it. All generated income is 100% attributed to the right person. There is no tracking/ accounting for income attribution I have to do for this. CRA is happy (hopefully) because all slips are reported to the correct account with 100% attribution and it never changes. TurboTax is happy as it automatically imports the correct slips from the correct CRA account and assigns it to the correct tax return.

So it would be good for TurboTax to allow the 0% setting ... but it may not solve the REAL problem, as long as CRA continues to flag "unusual" income attribution splits, and changes in the proportions across tax years. The paired joint accounts just avoid all of this.