For those of you with a TFSA (Tax Free Savings Accounts...)

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-- For those of you with a TFSA (Tax Free Savings Accounts...)

Posted by Swamper on Dec-21-2009 18:44:

For those of you with a TFSA (Tax Free Savings Accounts...)

LINK

Consider making withdrawals from your Tax-Free Savings Account by Dec. 31.

"If you have set up a TFSA and you're planning a withdrawal, consider doing so before the end of 2009 rather than early 2010," KPMG advises. Why is that? The firm points out that amounts withdrawn aren't added to your TFSA contribution room until the start of the year after the withdrawal. So if you have $5,000 in your TFSA and want to take out $4,000, do it in December. That way, you could re-contribute that $4,000 along with your new 2010 contribution limit of $5,000 as early as January 2010. If, on the other hand, you withdraw that $4,000 in January, you won't be able to re-contribute it until 2011.

Posted by FunkyCrew on Dec-21-2009 18:46:

Re: For those of you with a TFSA (Tax Free Savings Accounts...)

quote:
Originally posted by Swamper
LINK

Consider making withdrawals from your Tax-Free Savings Account by Dec. 31.

"If you have set up a TFSA and you're planning a withdrawal, consider doing so before the end of 2009 rather than early 2010," KPMG advises. Why is that? The firm points out that amounts withdrawn aren't added to your TFSA contribution room until the start of the year after the withdrawal. So if you have $5,000 in your TFSA and want to take out $4,000, do it in December. That way, you could re-contribute that $4,000 along with your new 2010 contribution limit of $5,000 as early as January 2010. If, on the other hand, you withdraw that $4,000 in January, you won't be able to re-contribute it until 2011.

thanks Del
I'm just waiting to add another $5K

Posted by Swamper on Dec-28-2009 22:59:

Bump

Posted by SniFFleS on Dec-29-2009 00:14:

If you're playing the market with your account its also a good idea to pull out the gains if u have anything substantial. Then put back the beginning of the next year. That way you lock in the growth of the amount you can contribute.

Posted by StereoPrincess on Dec-29-2009 17:44:

mmmm. good thinking.

Posted by Swamper on Dec-30-2009 05:55:

quote:
Originally posted by SniFFleS
If you're playing the market with your account its also a good idea to pull out the gains if u have anything substantial. Then put back the beginning of the next year. That way you lock in the growth of the amount you can contribute.

Maybe I'm missing something but I don't get this -- why sell something early solely to cash out? You don't 'increase' your contribution amount for the following year by doing this...