Not sure how much RRSPs you need to contribute to reduce your tax owing or maximize your refund? Need help optimizing your RRSP contributions and carry forward amounts? Don’t really understand how the RRSP Schedule 7 works and don’t want to fill it manually? TurboTax products have an RRSP optimizer that eases this process for you.
TurboTax’s built-in RRSP Optimizer makes it easy to see how different RRSP contributions amounts can increase your tax refund or reduce your tax owing:
- You don’t have to make any calculations as TurboTax does it all for you.
- The amount of your potential refund or tax owing will be displayed before filing.
- To see how different RRSP contributions scenarios would affect your income tax, you don’t have to return to different forms and input different numbers to see different results; you will be able to do it all on the same page and the optimizer will give the results instantly.
Using the RRSP Optimizer is easy
When you first start working on your return with TurboTax, you are asked to enter your personal information and answer a few simple questions about your tax situation. One of these is whether or not you’ve contributed to an RRSP. You will need to collect the following information:
- All the RRSPs invoices from your plan provider for the two periods:
- March 2nd to Dec 31st which is referred to the remainder of the year on the invoice
- The first 60 days of the following year
- Your HBP and LLP balances and required payments.
- Any transfer amounts made from or to your registered plans.
- Your Contribution room and carry forward undeducted RRSPs from your Notice of Assessment or in My Account CRA services.
The TurboTax software will walk you through how to report the. You will first need to put your contributions limit (deduction limit). It also has a link to your My Account to get access to your information, and a phone number if you wish to speak to a CRA agent.
On the following page, you will enter your RRSP contributions summary from March 2nd to Dec 31st of the taxation year and the first 60 days of the following year. Enter the new RRSP for each invoice separately.
On the following pages, you will fill information regarding your HBP, LLP, and any transfers made to other registered plans. You will also be asked to enter information regarding any unused contributions. Unused or undeducted contributions are contributions made in prior years but were not deducted from your taxes.
You will then reach the RRSP Optimizer page. On this page, you will be able to estimate the possible refund or amount owing using the slider under the “Additional RRSP Contribution” section. This optimizer allows you to calculate the maximum RRSP contributions you need to make before the RRSP deadline which is before March 2nd (or before March 1st in a leap year) and how it will affect your taxes.
If you have already completed your Personal Tax Profile, and still wish to make further changes to your RRSP, you can quickly access the RRSP Optimizer from the drop-down menu on the left side.