TFSA question...how much can I contribute..

[eblend]

Hi guys,

Put some money into TFSA the very first year it came out, and then later that year took all the money out of it for a house purchase. I am about to start saving like crazy, so I want to know how much I can put in.

Here is all my history from my TFSA account (only one), can someone please sort it for me, I think I can contribute 15k now..? Or is it $1.12 less then 15k since I have a $1.12 balance in there.

Thanks

Date Transaction details Funds out Funds in Balance
Dec 17, 2009 ANNIVERSARY PAYMENT $1.12 $1.12


Oct 02, 2009 TRANSFER OUT $3.11 $0.00


Sep 30, 2009 INTEREST $3.11 $3.11


Sep 30, 2009 TRANSFER OUT $5,057.63 $0.00


Aug 31, 2009 INTEREST $3.21 $5,057.63


Jul 31, 2009 INTEREST $3.21 $5,054.42


Jun 30, 2009 INTEREST $3.14 $5,051.21


May 29, 2009 INTEREST $4.44 $5,048.07


Apr 30, 2009 INTEREST $5.97 $5,043.63


Mar 31, 2009 INTEREST $7.83 $5,037.66


Mar 12, 2009 INTEREST EARLY BIRD INCENTIVE RATE $4.70 $5,029.83


Feb 27, 2009 INTEREST $9.72 $5,025.13


Feb 12, 2009 INTEREST EARLY BIRD INCENTIVE RATE $3.34 $5,015.41


Jan 30, 2009 INTEREST $12.07 $5,012.07


Jan 02, 2009 TRANSFER IN $5,000.00 $5,000.00

[leftwing]

You can contribute 5,000 per year for since it was introduced in 09, providing youve been over the age of 18 all those years. So you can have a maximum of 15,000 in your TSFA as of january 2011

[ercchry]

Originally posted by leftwing
You can contribute 5,000 per year for since it was introduced in 09, providing youve been over the age of 18 all those years. So you can have a maximum of 15,000 in your TSFA as of january 2011

so is this for everyone? or just those that opened a tfsa from the beginning?

lets say i never opened one till this week, could i dump $15k into it right away?

[Mibz]

I believe that $15,000 minus the $1.12 that is currently in there is correct.

Originally posted by ercchry
lets say i never opened one till this week, could i dump $15k into it right away?

Yes

[holden]

You can contribute $15,060.74.

(5,057.63 + 3.11 + 5,000.00 + 5,000.00)


An increase while inside a TFSA also increases your total TFSA amount. So assume on Jan. 2010 I contributed $5,000 and by Dec. 210 it has increased to $10,000. If I withdraw all of it before the end of the year, then on Jan. 2011 I have $15,000 contribution room ($10,000 + $5,000).

[leftwing]

Originally posted by ercchry


so is this for everyone? or just those that opened a tfsa from the beginning?

lets say i never opened one till this week, could i dump $15k into it right away?

Yepp. As long as you were 18 when it started. If not you can dump in 5k per year for the amount of years youve been over 18

[Feruk]

Originally posted by holden
You can contribute $15,060.74.

(5,057.63 + 3.11 + 5,000.00 + 5,000.00)


An increase while inside a TFSA also increases your total TFSA amount. So assume on Jan. 2010 I contributed $5,000 and by Dec. 210 it has increased to $10,000. If I withdraw all of it before the end of the year, then on Jan. 2011 I have $15,000 contribution room ($10,000 + $5,000).

I'd be really careful OP, because advice like the one above is totally incorrect and would make you actually conribute $5,060.74 more then you're allowed to.

From my understanding, money that is taken out CANNOT be contributed back in. You have put $5,000 in, you can add another $10,000. Withdrawals make no difference; the room is NOT added on top.

[eblend]

Originally posted by Feruk


I'd be really careful OP, because advice like the one above is totally incorrect and would make you actually conribute $5,060.74 more then you're allowed to.

From my understanding, money that is taken out CANNOT be contributed back in. You have put $5,000 in, you can add another $10,000. Withdrawals make no difference; the room is NOT added on top.

I was under the impression that you are not able to recontribute within that year only, and that contribution rooms becomes available once again at the start of the new year..no?

[Team_Mclaren]

Originally posted by eblend


I was under the impression that you are not able to recontribute within that year only, and that contribution rooms becomes available once again at the start of the new year..no?

yes

[Feruk]

Originally posted by eblend


I was under the impression that you are not able to recontribute within that year only, and that contribution rooms becomes available once again at the start of the new year..no?

Oh? I learn something new every day I guess. Did not know that.

[djayz]

Originally posted by holden
You can contribute $15,060.74.

(5,057.63 + 3.11 + 5,000.00 + 5,000.00)


An increase while inside a TFSA also increases your total TFSA amount. So assume on Jan. 2010 I contributed $5,000 and by Dec. 210 it has increased to $10,000. If I withdraw all of it before the end of the year, then on Jan. 2011 I have $15,000 contribution room ($10,000 + $5,000).

Same thing I came up.

Any growth that you withdraw can be added to your next years contribution.

[B20EF]

Originally posted by holden
An increase while inside a TFSA also increases your total TFSA amount. So assume on Jan. 2010 I contributed $5,000 and by Dec. 210 it has increased to $10,000. If I withdraw all of it before the end of the year, then on Jan. 2011 I have $15,000 contribution room ($10,000 + $5,000).

Just found this out too. Theoretically you could turn your $15k into $100k in penny stocks, spend it all. Then have $105k contribution room the next year. It's a scenario I've been trying to do, very unsuccesful so far.

[anschutz_92]

Simply put your total contribution room is:
$5000 each new year PLUS unused contributions from previous years PLUS any money that was withdrawn from the account

Any money that has been withdrawn from your TFSA cannot be recontributed until the following calander year. The TFSA should be one of the last accounts you should be withdrawing from if you need quick cash because of this rule. You withdraw money in March you now have nine months to wait before that money can generate income or grow tax free. However moving money around within your account is allowed, you could do 5 trades a day within your account if you so choose.

Now should your investment yield negative return, you have now permentently lost that contribution room.

[ExtraSlow]

Originally posted by anschutz_92
Now should your investment yield negative return, you have now permentently lost that contribution room.

This is one reason to put your safest investments in your TFSA. The other would be that typically "safe" investments produce interest, which is taxed the highest.
But that assumes you have a mix of investments in in a bunch of different savings vehicles (RRSP, TFSA and unregistered accounts) etc.

[Supa Dexta]

If I really want to force myself to save some money for new property in 6-18 months time, what is my best bet.

Same boat never put anything in TFSA's to date.

Do I put it there and invest casually, or put it in RRSPs where I know it will be when I need it?

I've never been big on RRSP's though and have also never put any in there. Or do I do both? I can likely come up with 30 or 40k if I wanted to.

[Mibz]

I'm under the impression that RRSP funds can only be pulled penalty-free if it's first-time home buying. If you already own property then I think you'll get taxed hard so TFSA would be better.

Somebody can feel free to correct me though.

[Team_Mclaren]

Originally posted by Supa Dexta
If I really want to force myself to save some money for new property in 6-18 months time, what is my best bet.

Same boat never put anything in TFSA's to date.

Do I put it there and invest casually, or put it in RRSPs where I know it will be when I need it?

I've never been big on RRSP's though and have also never put any in there. Or do I do both? I can likely come up with 30 or 40k if I wanted to.

well is this your first home? if so, put 25k in your rrsp and pull it back out (min 90 days), so you'll get the tax incentives for the current year and will be able to use the full amount without paying taxes on it. Do keep in mind that the 25k you pulled out for your first home needs to be put back into rrsp in the future (within 15 years). and that repayment will not be considerered as new RRSP contribution.


If its not your first home, then just max out your TFSA (15k) so you save some tax on your investments.

[Supa Dexta]

Yeah it will be my first property, tried to buy in the past several times, but never struck a deal. So I ended up blowing my money elsewhere..

Anyways, plan is to get smart, put some money away this year and get back on track. Right now I'm thinking of buying property this year and then building on it next yr if things go right.

Would likely be 6 months at the earliest that I would be purchasing the land, so I have some time to work with, so I can probably come up with 30-40k in that time frame..

[kenny]

Don't trust all the answers in this thread, some of it is wrong, and some is correct. Best bet is to just check at the source itself.

Go here:
http://www.cra-arc.gc.ca/esrvc-srvce.../menu-eng.html

Setup your account, and when you login, it'll tell you how room you have left to contribute to your TFSA throughout the year so you can be sure you don't over contribute and get penalized.

[ExtraSlow]

Supa, like has been mentioned, I would reccomend putting $25k into your RRSP right now. You'll get the tax refund for it in the spring, which is a pretty nice ROI. You can withdraw that $25k penalty free as long as the cash has been in for 90 days.

Great deal for first time homebuyers.

I highly reccomend saving up the max down payment you can. It'll make a big difference to your mortgage payments.