Pension and retirement topics

Are there disadvantages to splitting my spouse's pension income?

TurboTax Support — Tue, 27 Jul 2021 11:32:42 GMT

By splitting pension income with your spouse or common-law partner, you (the "pensioner") can lower your net income and reduce the amount of tax you pay. However, as you lower your income, you increase the income of your spouse (or the “pension transferee"). This increase in income could result in the pension transferee having to make instalment payments in the following year. Installment payments must be paid if the taxpayer owes $3,000 or more (or $1,800 for Québec residents). It’s also possible for the transferee’s income to increase enough to trigger a reduction in the Age Amount credit and trigger a clawback to the amount of Old Age Security received in the tax year, which can also benefit the Age Amount and Old Age Security clawback amounts for the transferor. When you prepare your returns together, TurboTax optimizes your split pension income to help determine the best amount to transfer. The Pension Splitting Optimizer cannot consider programs outside of the tax system that is based on individual income levels, such as: renters' assistance nursing home assistance income-based drug coverage reduction in Old Age Security (OAS) benef...

How does the Pension Splitting Optimizer work?

TurboTax Support — Fri, 29 Oct 2021 21:22:12 GMT

If you are married or living with a common-law partner, you receive pension income, and you are in different tax brackets, it might make sense to split your pension income. The TurboTax Pension Splitting Optimizer automatically calculates the best distribution of your pension income, which can help you and your spouse/partner pay less in taxes. TurboTax considers the totality of information entered into your tax returns, then determines the amount(s) that can be split with your spouse (up to one half). You are also shown a comprehensive view of the different ways you can split your pension income, and TurboTax will recommend the best option to optimize your return. The option of choosing the recommendation or picking a different split is entirely up to you! Note: Not all pension is eligible for splitting The Pension Splitting Optimizer is included in all online editions of TurboTax except for TurboTax Free. TurboTax's Pension Splitting Optimizer is available only if you're preparing your and your spouse's returns together at the same time. Related information: How do I split my pension income with my spouse? Are there disadvantages to s...

Where do I enter eligible retiring allowance (severance) that's been transferred to an RRSP?

TurboTax Support — Mon, 18 Jul 2022 15:02:53 GMT

There are two steps to entering your eligible retiring allowance transferred to an RRSP. First, you'll enter your T4 slip, then you'll enter the transfer to your RRSP. 1. Enter your T4 slip Select Find from the TurboTax menu Enter T4 Employment Income, select it from the list, then select Go Enter the information exactly as it appears on your T-slip (your eligible retiring allowance is shown in box 66) 2. Enter your RRSP info Select Find from the TurboTax menu Enter RRSP Profile, select it from the list, then select Go On the Your RRSP Profile step, check the box for Made RRSP contributions during 20XX or the first 60 days of 20XX, then select Continue On the What's your RRSP/PRPP deduction limit? step, enter your deduction limit, then select Continue On the RRSP Contribution step, enter the amount of your eligible retirement allowance that you transferred to your RRSP, as shown on the receipt from your financial institution If you're using TurboTax CD/Download, the question Is this RRSP contribution a designated transfer of eligible income amount? appears on the same screen. If your answer is yes, enter the amount that's a designated transfer, then enter the same amount again

Why are my Canada Pension Plan (CPP) amounts incorrect on my tax return?

TurboTax Support — Mon, 18 Jul 2022 21:07:38 GMT

There are a few different reasons your CPP amounts may be different from what you're expecting. Your birthdate is incorrect or you turned 18 or 70 during the tax year. The CPP amount you're required to pay is based on your age income. TurboTax may be calculating a CPP overpayment because your age was entered incorrectly or you turned a "threshold" age during the year. To verify (or change) your birthdate: Select Find* (or the magnifying glass icon) from the TurboTax menu. In the Find window, type Personal Info and select Go. You paid more CPP than you needed to. Your employer(s) may have withheld more CPP amounts from your pay than was required by your age and income. TurboTax automatically sums up your CPP contributions from your T4s and calculates the overpayment for you, if applicable. You've already started receiving CPP benefits. If you've started collecting CPP, you don't need to make CPP contributions anymore and should receive any amounts you contributed back for the current tax year. You indicated that you're CPP exempt. When you indicate that you're CPP exempt in box 28 of your T4, TurboTax automatically calculates any CPP amounts paid as an overpayment. To verify (or change) box 28 on your T4 slip(s): Select Find* (or the magnifying glass icon) from the TurboTax men...

How do I change the RRSP carryforward amount?

TurboTax Support — Mon, 18 Jul 2022 15:03:45 GMT

You can change the amount of RRSP contributions that get carried forward (to reduce your taxable income in a future year) by changing the amount you’d like to claim this year. The amount available for deduction minus the amount you deduct equals the amount that gets carried forward. Select the relevant option below for instructions on how to change the amount you carry forward in TurboTax. Instructions for TurboTax Online Note: Before beginning, fill out your personal information and build your tax profile in TurboTax to ensure optimal results. The Find button won't appear until these steps are complete. Select Find (or the magnifying glass icon) from the menu Enter RRSP Contributions in the Find window Select RRSP Contributions to be Carried Forward and then select Go On the RRSP/PRPP and SPP Carry Forward step, TurboTax displays the amount of contributions exceeding your limit. This amount is automatically carried forward To adjust how much of this tax year’s contributions get carried forward: Next to RRSP/PRPP contributions you are deducting, enter the amount you’d like to deduct this year and then select Continue. The remainder will get carried forward For example: TurboTax shows that $3,000 is available to deduct in the current tax year. If you’d like to carry forward $2,...

Why aren't my RRSP contributions appearing on my tax return?

TurboTax Support — Mon, 18 Jul 2022 21:07:52 GMT

If entered correctly, you should be able to view your RRSP contributions on your RRSP Summary in TurboTax. You can navigate to this section by following the steps below: Select Find (or the magnifying glass icon) from the menu. In the search field: For TurboTax Online, type RRSP summary. For TurboTax CD/download, type RRSP/PRPP summary. Select the phrase you typed from the list of search results and then select Go. All the RRSP contributions you report are summarized in your TurboTax account, but they don't necessarily show up on your detailed tax summary. Here are some of the most common reasons why: You haven't entered your deduction limit To calculate your RRSP deduction properly, TurboTax needs to know your deduction limit for the tax year. If you've entered your RRSP contributions but haven't entered your deduction limit, TurboTax won't be able to calculate your deduction properly. They're calculating as repayments If you designate your RRSP contributions as repayment of a Lifelong Learning Plan (LLP) or Home Buyers' Plan (HBP), they'll be calculated on your return as repayments, not contributions. You've entered an amount over your limit Since the CRA doesn't allow RRSP contributions over your contribution limit, TurboTax won't calculate your deduction if you enter contr...

How do I enter RRSP contributions in TurboTax Online?

TurboTax Support — Fri, 08 Apr 2022 18:18:05 GMT

https://youtu.be/EK5LRnqxoCM RRSP slips from contributions made between March 3, 2021 and March 1, 2022 (inclusively), as well as contributions made before then that haven't already been reported, are entered into TurboTax Online in the same way. For an RRSP contribution made before March 2, 2021, report it on the tax return for the tax year in which you made the contribution. You can do this by signing into TurboTax Online for the appropriate tax year and making an adjustment to your return. Watch the video above for instructions on how to add spousal RRSPs using TurboTax, or follow the steps below to report your RRSP contributions. To report RRSP contributions made after March 2, 2021, and before March 2, 2022 Before you begin, complete the Intro/Profile part of your return until the Find button appears in the menu. Select Find (or the magnifying glass icon) In the Find window, type RRSP profile in the search field. Select it from the list and then select Go Select the checkbox for Made RRSP contributions during 2021 or the first 60 days of 2022, as well as any other options that apply to you, and then select Continue Follow the on-screen prompts and TurboTax will guide you through the steps for entering your RRSP contributions Related information How do I claim (unused) RRS...

How do I claim (unused) RRSP contributions I made in previous years but didn't deduct?

TurboTax Support — Fri, 19 Nov 2021 17:03:09 GMT

Unused RRSP contributions are contributions you made to an RRSP (in a prior year) that have been carried forward. In other words, you reported the contribution on your tax return for the year in which you made the contribution, but didn't apply it as a deduction to reduce your taxable income (or designate your contribution as a Home Buyers' Plan or Lifelong Learning Plan repayment). Important: If you made an RRSP contribution in a prior year and it hasn’t been reported on your tax return for that year, you’ll need to file an adjustment to that return in order to eventually apply the contribution as a deduction. Here’s how to file an adjustment. Your unused RRSP contribution amount from previous years will be on your RRSP Deduction Limit Statement, found on your latest Notice of Assessment. When you use CRA’s Auto-Fill My Return, TurboTax automatically downloads the contribution amount (if applicable) into your tax return for you. Note: Unused contributions are different from unused contribution room, which is the amount you're entitled to contribute and deduct, minus the amount that you actually deduct. Select the applicable option below for instructions on how to claim unused RRSP contributions made in previous years. Instructions for TurboTax Online Select Find (or the magni...