RRSP contribution without income in family

Forum|Forum|3 years ago
March 7, 2023
1 reply
0 views

Hello,

My wife was on disability in 2022 and didn't work but still contributed to RRSP 3,000$.

I was going to use a carry forward option for the contribution she did, so she can use that amount and reduce tax in the future after she is back to work. But then I realized that without carrying it forward the contribution significantly reduces my tax (I fill our taxes together in Turbo Tax). Why it happens? Why my wife's contribution reduces my tax? I don't think it has anything to do with spousal contribution - it still her money, not mine...

Appreciate any help to understand it.

BrendaW-US

Did you enter the amount of RRSP she contributed under "Contribution amount to your spouse's RRSPs"?

LeonConcordAuthor

No, I didn't because it was her contribution, not mine.

LeonConcordAuthor

One more interesting fact. It only happens when my wife has small income from employment insurance (T4E), with tax of 345$ on it. While the return I get from her RRSP is much bigger than 345$. If I delete T4E then her RRSP doesn't increase the refund.