Bug in offsetting Box 18 T4RSP income with corresponding RSP contribution receipt - deceased spouse

[summerset]

Am starting a new thread because a similar thread called this issue "solved", and it is not.

I just got off a very frustrating phone call with TurboTax help.  Turbo tax is not allowing me to properly deduct the contribution receipt that was provided to offset the Box 18 amount on the T4RSP, due to a spouse's death.

TurboTax default is to carry forward any amount over and above current RSP room.  Well, my mother has $6K in RRSP room but has a $126K RSP contribution receipt to offset the $126K on the T4RSP. 

Previous answers indicate to check the box that specifies that this was a "Designated Transfer of an Eligible Amount."  But THERE IS NO BOX TO CHECK!

There is a work-around mentioned in another thread, which I've copied & pasted below.  I guess this is what I will have to do, however, it stuns me that TurboTax does not have an actual solution to this.  I feel concern that CRA is not going to like the workaround below as it does not put the RSP contribution receipt on the right line, which increases risk of audit or reassessment.  I am also terribly concerned that TurboTax help seemed to have no idea what I was talking about and could not help me in any way.  

I would dearly appreciate any help that can be provided. 

The correct method is to put it under "other deductions" which is line 23200 in the tax return form. To do this in Turbo Tax you have to go through a number of steps: got Personal Tax Profile under MyInfo; select Other Credits and Deductions; select Other Deductions, scroll to the bottom and select "I had other deductions not covered above"  When you get to appropriate section where the information is enter you need to fill in the box with the explanation of what it is.

[dmac353]

I asked an almost similar question yesterday. I am still hoping for an answer. But this might help you too, if we can't get an exact answer.

"I am preparing taxes for a my deceased son and his widow. His RRSPs were directly transferred to her RRSP accounts. She had only $2K in her RRSP deduction room and the amounts were about $30K.

The only way that I could see how to use this was to remove the $2K and leave it blank. 

Is this the correct way to do it? "

[summerset]

Thanks for the reply!  Good to know I'm not alone 🙂 

Last year, the CRA auto-deposit function mistakenly put my mother's Land Royalties into more of a Music Royalties spot.  I didn't catch it at the time, trusting the auto-deposit to do things right I guess.

It caused no end of grief with CRA.  After months, it was finally corrected.  

So, I am not keen at all to mess around with things.  Want to be sure it's done right, and TurboTax owes its users a proper solution.  

[dmac353]

I thought I sent a reply to you yesterday but it seems to have disappeared. If you saw it, sorry.

I like the "use other deduction line" that you posted. I think I will switch to that so it doesn't screw up the widows carry forward RRSP info. So I may go to that if we don't get a direct answer.

I also asked a quick question of you.

When you were doing the separate taxes in the first year, did you do the widow or the deceased first? It seems that I am in a loop, both ask for the others income, so I am jumping back and forth with new info at times. I do use both the easy step and the forms because I don't trust myself or the program completely. I hope this makes sense.

[summerset]

I finally bit the bullet and paid for the "live help" version of the software.  It doesn't change much - you still just have to reach out and either chat or voice call with an agent, but the person I connected with was able to help me.  So maybe they assign their more experienced agents for this product??

I wish I had written down exactly what he told me to do, but I do know it originated in the RRSP profile section.  On the survivor's return, Go to RRSP Profile, then be sure to click Transfers to RRSP (I had not done this previously).  This opens up the ability to manually enter an amount in the Transfers to RRSP section that comes after you enter the RRSP contribution receipt.   

I hope this works for you as well.

I am in the same boat about reporting the opposite spouse's income.  I will go back and finalize those entries once I am happy with the returns.  It is annoying for sure.  

[dmac353]

Thanks so much. I will give that a look. 

They should consider a way to leave the returns coupled while you work on them. It would make things so much simpler. I may send in some suggestions.

[Gjardine]

Talking to canada tax revenue , I found out you have to fill out Sch 7 , A and C.after that it will put the amount on line 20800  .  

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4177/death-rrsp-a...

And

https://www.canada.ca/en/revenue-agency/services/forms-publications/tax-packages-years/general-incom...

[dmac353]

Thank you for the information. My query was for 2021 taxes and my work around by using the other deductions line did work. 

[Gjardine]

Would the above solution work for 2021 cause it worked for 2022.

[dmac353]

Sorry, I do not know.  2021 was the last time I did a deceased tax.