Comments on: Juggling the Mortgage, RRSP’s and TFSA’s http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/ Wed, 08 Feb 2012 17:31:40 +0000 hourly 1 http://wordpress.org/?v=3.1 By: Canadian Dream http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-20275 Canadian Dream Wed, 18 Feb 2009 11:44:59 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-20275 Rick, Actually if you put 10K into an RRSP your income becomes $10,000 less, hence the $4K tax refund. There is no refund for putting money in a TFSA, but it does grow tax free like an RRSP. Tim Rick,

Actually if you put 10K into an RRSP your income becomes $10,000 less, hence the $4K tax refund.

There is no refund for putting money in a TFSA, but it does grow tax free like an RRSP.

Tim

]]> By: Rick http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-20228 Rick Tue, 17 Feb 2009 17:12:01 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-20228 If your gross income is 100k for 2008 and you put 10k into your RRSP basically you get a 4k tax break. ( your income now becomes 4500. less. Over to the TFSA, do you get the same tax break? If your gross income is 100k for 2008 and you put 10k into your RRSP basically you get a 4k tax break. ( your income now becomes 4500. less.

Over to the TFSA, do you get the same tax break?

]]> By: Paul http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3847 Paul Sun, 02 Mar 2008 01:49:42 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3847 CRA will allow transfers in-kind to the TFSA but will consider it a disposition. So you will be forced to realize a taxable capital gain using the asset's market value at time of transfer. Hence no wash. "In-kind" only means you get to hold on to the asset, not that you avoid taxes. CRA will allow transfers in-kind to the TFSA but will consider it a disposition. So you will be forced to realize a taxable capital gain using the asset’s market value at time of transfer. Hence no wash. “In-kind” only means you get to hold on to the asset, not that you avoid taxes.

]]> By: Canadian Dream http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3842 Canadian Dream Sat, 01 Mar 2008 13:26:04 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3842 Quentin, Not a problem. I did read your comment earlier, I was just rolling the idea around in my head for a while. I see what your getting at. You could just push off your capital gains until you could wash them in your TFSA and then pull them out to make more room again to repeat. I personally don't see them allowing in kind contributions for this exact reason. It would be a huge loop hole to avoid tax. Matt, A T1213 would be a great idea to do if you have a regular contribution level and then you could move the money over to your TFSA sooner. Tim Quentin,

Not a problem. I did read your comment earlier, I was just rolling the idea around in my head for a while.

I see what your getting at. You could just push off your capital gains until you could wash them in your TFSA and then pull them out to make more room again to repeat. I personally don’t see them allowing in kind contributions for this exact reason. It would be a huge loop hole to avoid tax.

Matt,

A T1213 would be a great idea to do if you have a regular contribution level and then you could move the money over to your TFSA sooner.

Tim

]]> By: Quentin DSouza http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3833 Quentin DSouza Sat, 01 Mar 2008 02:36:53 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3833 Just in case you see this comment on this post :-) http://www.thefinancialblogger.com/the-tax-free-savings-account-tfsa-%e2%80%93-a-creative-financial-approach/#comment-1940 I'm not pressuring a response from you, just really anxious to get some feedback. ;-) Just in case you see this comment on this post :-)

http://www.thefinancialblogger.com/the-tax-free-savings-account-tfsa-%e2%80%93-a-creative-financial-approach/#comment-1940

I’m not pressuring a response from you, just really anxious to get some feedback. ;-)

]]> By: Quentin DSouza http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3800 Quentin DSouza Fri, 29 Feb 2008 03:31:41 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3800 This comment is also theoretical ;-) - so what if we will we be able to do a transfer in kind of non-registered funds into a TFSA closer to retirement in order to avoid taxation and wash non-registered funds like those of the Smith Manouvre or other non-registered investments - so if we have 100,000 of TFSA room we transfer in kind from the non-registered funds - then withdraw funds from the TFSA to avoid taxation and create room again to do it again the next year? That would mean that most couples would need to save less something closer to $70,000 a year (if they expected to have an income of $100,000 at early retirement) - since there would be no tax on the money from the TFSA. Would it work? This comment is also theoretical ;-) – so what if we will we be able to do a transfer in kind of non-registered funds into a TFSA closer to retirement in order to avoid taxation and wash non-registered funds like those of the Smith Manouvre or other non-registered investments – so if we have 100,000 of TFSA room we transfer in kind from the non-registered funds – then withdraw funds from the TFSA to avoid taxation and create room again to do it again the next year?

That would mean that most couples would need to save less something closer to $70,000 a year (if they expected to have an income of $100,000 at early retirement) – since there would be no tax on the money from the TFSA.

Would it work?

]]> By: Matt http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3791 Matt Thu, 28 Feb 2008 20:02:25 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3791 Why don't you fill out form T1213 and get your RRSP contributions deducted at source? Why don’t you fill out form T1213 and get your RRSP contributions deducted at source?

]]> By: Canadian Capitalist http://blog.canadian-dream-free-at-45.com/2008/02/28/juggling-the-mortgage-rrsps-and-tfsas/comment-page-1/#comment-3786 Canadian Capitalist Thu, 28 Feb 2008 15:40:53 +0000 http://blog.canadian-dream-free-at-45.com/?p=364#comment-3786 I agree with your assessment of RRSP versus TFSA. For most people (it's certainly true for me), the average tax rate on RRSP contributions will be much less than the average tax rate on withdrawals (esp. if you plan to retire early). So, it's RRSP contributions first. I agree with your assessment of RRSP versus TFSA. For most people (it’s certainly true for me), the average tax rate on RRSP contributions will be much less than the average tax rate on withdrawals (esp. if you plan to retire early). So, it’s RRSP contributions first.

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