NotesCh9revised

NotesCh9revised - Registered Retirement Savings Plans...

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Registered Retirement Savings Plans (RRSP) Important Rules - Contribution Limit - Unused RRSP Deduction Room - Excess Contributions - Undeducted Contributions - Transfers into RRSP - Withdrawals 1) Home Buyers’ Plan 2) Lifelong Learning Plan - Spousal RRSP Contribution - Definition of Earned Income
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RRSP - it is a tax shelter - money contributed up to certain limits are deducted from taxable income - interest and dividend income are earned within RRSP without tax being payable - withdrawals out of RRSP are taxable
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RRSP Contributions - allowed to contribute 18% of last year’s earned income into an RRSP (maximum of $21,000 for 2009 year) - if the maximum allowed RRSP contribution is not made, the amount is accumulated in an account called “Unused RRSP Deduction Room” - contributions can be made in a future year up to the amount in the “Unused RRSP Deduction Room”
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- this is when a taxpayer puts more money into an RRSP than he is allowed Undeducted Contributions
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NotesCh9revised - Registered Retirement Savings Plans...

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