How to correctly input data for LIRA to LIF conversion and one-time unlocking transfer to RRSP

[TurboTaxBrenda]

You need to start by entering your T4 Slips- T4(RIF) and the T4(RSP) Once that has been entered and you continue you will go to RRSP Profile for 2022 and check off the box that says Transfers to RRSP's and any other one that needs to be checked off and continue. You will then enter your 2022 RRSP/PRPP Deduction limit and click continue. You will then enter the information required on RRSP Contribution page and click on Done With RRSP's you will then see your RRSP Contribution Summary- Click Done with RRPS's. The following page will be  the "Transfers to RRSPs/PRPPs and will be able to enter your amount there. Then you will need to click continue for it to save. 

Thank you for choosing TurboTax.

[JMRivest]

In fact it did work for me that way for 5-6 years but for the last two years CRA investigated my tubotax  report (online version) and they told me that doing the way it is explained here is not the proper way because the  contribution amount to put back the amount in the LIRA appears as Other Deduction which is not ok.

They told me that you need to put $0 in te Other deduction line 23200 (for the CRI transfer), it needs to be filled in the Schedule 7 (annexe in french) at the line 20800, 24500 and 24640. Unfortunately Turbotax online version does not fill this schedule 7 properly and CRA keeps reviewing my tax report every year now. I dont know if Turbo tax can contact CRA and change their programs accordingly. If Turbo tax need a copy of the CRA answer they can contact me.

[TurboTaxSusan]

@JMRivest Please contact our phone support team at 1-888-829-8608 as they will be better able to assist you.

[JMRivest]

I would love to contact support to get help but when i contact them and they dont even know what a LIRA or RRSP is, that is kind of scary. Do you have a support number for Canada, more specifically for Quebec where we have to fill two different income tax reports, one provincial, one federal, with support people who knows how income tax works, not only how your program works.

Once again, in 2023, after the previous message, CRA took 9 months to reimburse because they were investigating my LIRA to RRSP transfer saying that it was not reported correctly. Thanks.

[TurboImpotLiseD]

In order to help you, I suggest you contact CRA prior to entering your slips in the software. Let us know how CRA tells you to enter the data and we will be in a better position to tell you the steps in TurboTax. This is a good time to call as tax season is not in full swing yet. 

Call 1-800-959-8281 

• Monday to Friday: 8 am to 8 pm (local time)
• Saturday: 9 am to 5 pm (local time)

Thank you for using TurboTax

[JMRivest]

If you read the message just before in the thread, i am telling you what the CRA wrote to me after reviewing it.

''They told me that you need to put $0 in te Other deduction line 23200 (for the CRI transfer), it needs to be filled in the Schedule 7 (annexe in french) at the line 20800, 24500 and 24640. Unfortunately Turbotax online version does not fill this schedule 7 properly and CRA keeps reviewing my tax report every year now.''

[TurboImpotLiseD]

With TurboTax Online, you will not see the schedules before printing the whole return. May be consider using TurboTax Standard download to have access to all forms and schedules as you are doing your return. 

I recreated the steps in TurboTax Deluxe On line. There are many steps. First enter the income and then the RRSP contribution as follows: 

Step 1 - in your Profile, check the box that you have made a contribution to RRSP

Step 2 - a little further on the same page, check that you have made a withdrawal from a retirement account according to the slip you have received. I used a T4RIF/RL 2

Step 3 - click on T-Slips under Income in the left menu. Click on the slip you have received as Income from your LIRA.

Step 4 -  enter the information from your slip. Enter the amount again in Transferred to a RRSP Box 24. Click on Enter Relevé 2. The information might already be there in Box B and B(1) below. If not, enter it. Click Done with T4 and RL 2

 Step - 5  Continue until RRSP section. Enter the amount transferred from LIRA to RRSP. 

All amounts are in order in the Summary:

Step 6 -  verify in the Federal detailed summary that amounts are in order:

Step 7 - verify in the Provincial detailed summary that the amounts are in order:  

Let me know if this answers your question. Thank you for choosing TurboTax

[JMRivest]

Thanks i will try reporting it like this for 2023. Previous years I was using the Online Premier version , should it be working the same or I should use the Deluxe version?

[TurboImpotLiseD]

Using Premier Online will look the same as Deluxe. Follow the same steps. Please let me know if it works. Thank you.   

[SteveS2]

It looks like TurboTax Desktop Standard 2023 has fixed these issues and Schedule 7 lines 24500 and 24640 are filled out properly as long as you enter your LIF to RRSP transfer amount in **both** of the RRSP slip fields: a) "Contribution made between...", and b) "Designated Transfer of eligible income amount".

However, there appears to be one more related problem regarding calculation of the Pension Income Amount deduction (line 31400).  TurboTax 2023 seems to think the LIF to RRSP transfer amount is eligible for generating up to a $2000 Pension Income Amount deduction, which it is not.  The problem appears to be in the Pension Income Worksheet, which is not being populated with the transfer amount on line 5.  In my case line 5 is blank and I cannot enter a value there.  This leads to a miscalculation on lines 6 and 7 on the Pension Income Worksheet, which generates a false value for line 14 (which used to populate line 31400).

Is line 5 of the Pension Income Worksheet a calculated value?  If so which forms and lines input to the calculation?  As a temporary workaround I can override the value on line 14 and make it $0 to nullify the Pension Income Amount deduction.  However, I am not sure if the CRA will like this and perhaps it may generate a review flag for my return.  Please advise on how to solve this issue properly.