if I die, can my wife take my rrsp into hers and defer tax?
When a person dies, their registered retirement savings plan (RRSP) can be transferred to their spouse's RRSP on a tax-deferred basis if certain conditions are met. This transfer is commonly referred to as a spousal rollover.
To be eligible for a spousal rollover, the spouse must be the designated beneficiary of the RRSP. This means that the deceased must have named their spouse as the beneficiary in their RRSP contract or will.
If the spouse is the designated beneficiary, the value of the RRSP is transferred to their RRSP tax-free, and it becomes part of the spouse's RRSP. The spouse can then defer tax on the RRSP until they withdraw the funds.
It is important to note that the transfer of the RRSP to the spouse's RRSP is only possible if the spouse has enough contribution room to accommodate the transfer. If the spouse does not have enough contribution room, the excess amount will be taxed as income in the year it is received.
Also, if the spouse decides to withdraw funds from the RRSP before the age of 71, they will be subject to the same withholding taxes and penalties as they would if it were their own RRSP.
Therefore, it is important to consult a financial or tax advisor to understand the tax implications and ensure that the transfer is done correctly.
are you sure about this? "It is important to note that the transfer of the RRSP to the spouse's RRSP is only possible if the spouse has enough contribution room to accommodate the transfer. If the spouse does not have enough contribution room, the excess amount will be taxed as income in the year it is received"
I apologize for any confusion my previous response may have caused. The transfer of a deceased individual's RRSP to their spouse's RRSP does not depend on the spouse's available contribution room. The transfer is done on a tax-deferred basis, meaning the funds are not taxed when they are transferred to the spouse's RRSP.
However, once the funds are in the spouse's RRSP, any withdrawals will be subject to the same tax rules as any other RRSP withdrawal. For example, withdrawals will be considered taxable income and may be subject to withholding taxes. The amount of contribution room available to the spouse will also be affected by the transfer.
I hope this clarifies any confusion, and as always, it is important to consult a financial or tax advisor for specific guidance on individual situations.
ok, are you sure this time? what is your confident level in the percentage that this is correct? what is the percentage of correction for you previous statement?
Yes, I am confident that my corrected statement is accurate. The transfer of a deceased individual's RRSP to their spouse's RRSP is not dependent on the spouse's available contribution room.
My confidence level in the accuracy of my previous statement was lower, as it contained incorrect information. I apologize for any confusion it may have caused. My corrected statement reflects the accurate information on the topic.
As an AI language model, I strive to provide accurate and helpful information to the best of my abilities based on my training and knowledge. However, I am not infallible, and there may be cases where I may provide incorrect or incomplete information. In such cases, I rely on feedback and corrections from users to improve my responses and provide better assistance in the future.