TFSA question

[zandrmom]

Is TFSA contribution room cumulative? If I didn't deposit $5000 last year, can I add that on this year? Thanks!

[Natalka]

Each calendar year, you can contribute up to $5,000, any unused TFSA contribution room from the previous year, and the amount you withdrew the year before.

detailed info herre

http://www.cra-arc.gc.ca/tx/ndvdls/t.../menu-eng.html

[marstec]

A TFSA is meant for long-term savings, which is why you can't go through the teller to make changes. You need to keep track of the amounts that go in and out; some people learned the hard way about penalties for over contributing.

[lovelikewinter3]

Yes TFSA room is cumulative. Each year you get an additional 5k in space in your TFSA. If you don't contribute for 3 years, you still have the 15k in room in your TFSA. If you aren't sure how much contribution room you have left, you will have to call CRA or track down all previous contributions. And I believe that your TFSA limit is given to you with your tax return, but I could be wrong.

[ashedfc]

True,
- your unused contribution room is carried forward
- your withdrawal from previous years are added to the contribution room
- the limit is $5000 per year starting 2009; so a person has a total of $20000 contribution room in 2012 (next year it will become $25000)

I suggest - do not use TFSA account for your day to day banking, it will be a nightmare for accounting purpose.
Use TFSA to set aside a certain amount of money (whatever you can afford to live without) & invest it in the TFSA account for capital gains & let it grow exponential. Over a period of time, the capital gains will outgrow to a significant amount..
During retirement, you can access your TFSA money without paying any taxes; & without affecting your Social benefits like OAS/ GIS, etc ( as there's no clawback on TFSA withdrawal)..

[Ciel]

Your Notice of Assessment indicates what available TFSA room is available to you for 2012. So far, the limit has been cumulative as I don't have a TFSA.

[lucy16076]

My financial advisor set this account up for me to help me save for a newer vehicle that I was intending on buying next year. I've now come to realize that that wasn't a smart move. It would have been smarter to put it under my mattress for the 4 years it has taken me to save the money needed. I have maxed it out since 2009, but understand I can't withdraw all of it without tax repercussions....thought this wouldnt' be the case...and I can't withdraw it all at once? I was hoping for $20K to buy my newer car when my daughter turned 16 this year & took my "old" one over....thoughts anyone?

[ashedfc]

WHO says you cant withdraw all at once...

ASH
Financial Advisor
www.edfc.ca

[Gsxrboy]

Just like ASHEDFC asked, who told you, you cannot take it all out? Just make sure that your "Financial Advisor" didn't put you into a locked investment, there might be withdrawal charges. I would call the company directly that you have invested in and find out for sure on how to remove the money. But yes, you can request a bank draft if you wish, or simply ask for it in cash (just give the bank plenty of notice if you want it in cash)

[Ciel]

From the CRA link provided by Natalka, there is a page on withdrawals from a TFSA:
http://www.cra-arc.gc.ca/tx/ndvdls/t...drwls-eng.html

Making or replacing withdrawals from a TFSA

A qualifying transfer from one TFSA to another is not considered to be a withdrawal. For more information, see Transfers.
Making withdrawals

Depending on the type of investment held in your TFSA, you can withdraw any amount from the TFSA at any time. Withdrawing funds from your TFSA does not reduce the total amount of contributions you have already made for the year.

Withdrawals, excluding qualifying transfers and specified distributions, made from your TFSA in the year will only be added back to your TFSA contribution room at the beginning of the following year. See example 2 below.

[Brad]

Is TFSA contribution room cumulative? If I didn't deposit $5000 last year, can I add that on this year? Thanks!

Yes, unless you weren't 18 last year. TFSA contribution room only starts accumulating once you turn 18.

[Brad]

I have maxed it out since 2009, but understand I can't withdraw all of it without tax repercussions....thought this wouldnt' be the case...and I can't withdraw it all at once?

That's not true, whoever told you that is misinformed or you misunderstood them. You can withdraw anything in your TFSA with no tax repercussions, you just can't put it back in your TFSA until the next calendar year.

[lucy16076]

My financial advisor set this account up for me to help me save for a newer vehicle that I was intending on buying next year. I've now come to realize that that wasn't a smart move. It would have been smarter to put it under my mattress for the 4 years it has taken me to save the money needed. I have maxed it out since 2009, but understand I can't withdraw all of it without tax repercussions....thought this wouldnt' be the case...and I can't withdraw it all at once? I was hoping for $20K to buy my newer car when my daughter turned 16 this year & took my "old" one over....thoughts anyone?

WHO says you cant withdraw all at once...

ASH
Financial Advisor
www.edfc.ca

Just like ASHEDFC asked, who told you, you cannot take it all out? Just make sure that your "Financial Advisor" didn't put you into a locked investment, there might be withdrawal charges. I would call the company directly that you have invested in and find out for sure on how to remove the money. But yes, you can request a bank draft if you wish, or simply ask for it in cash (just give the bank plenty of notice if you want it in cash)

From the CRA link provided by Natalka, there is a page on withdrawals from a TFSA:
http://www.cra-arc.gc.ca/tx/ndvdls/t...drwls-eng.html

That's not true, whoever told you that is misinformed or you misunderstood them. You can withdraw anything in your TFSA with no tax repercussions, you just can't put it back in your TFSA until the next calendar year.

Thank you all for your help. I think I've misunderstood & been misinformed. Apparently it's been partially deposited into a "locked in" fund & the rest in a "not locked in" fund.. ?? I will seek out more answers & get to the bottom of this!

[Gsxrboy]

Find out what the name of the investment is and I would also review any paper work that was given to you.

Everyone reading this post, please always get a second opinion on what you are investing in, or ask a ton of questions on how your investments work. We think that the person sitting across from us is a professional, but it is still up to us to do our homework, never take anything an adviser says as true (remember Bernie Madoff, he used his smile and connections to fool people)

[ashedfc]

Its not only Bernie Madoff,
even JP Morgan (they are doing fraud in the derivatives market);
Barcley's doing fraud in the Libor market, etc... & now there are several other ones which we are just discovering...

even Bank of Canada manipulating the currency markets
Federal Reserve & major central banks printing money & doing outright fraud by counterfeiting currency..

second, third, fourth opinion all can have flaws, specially when the system itself is gone corrupt... over the last 30years or so, financial engineering has caused this mass devaluation of ethics in the financial services..