Low Hanging Fruit: Let Carry Over Provisions Ripen for Tax Season 2008

Just like Santa Claus, tax practitioners like to make their lists and check them twice before delivering a complete tax filing service, which includes tracking their clients' "carry over provisions".

The following list, excerpted from best-selling tax author and Knowledge Bureau President, Evelyn Jacks' Essential Tax Facts, will provide conversational guidance for taxpayers and their advisors before this year's tax files are stored for potential audit retrieval, or more happily, tax season 2009!

Period

Significance

Three years back

  • To apply non-capital losses to capital gains in those years.
  • To adjust most provincial tax credits.

Previous 10 Years

  • To correct errors and omissions for most federal provisions, including the GST Rebate (Line 457)

24 month period

  • In the year of death, to apply medical expenses in the best 24-month period ending at date of death

Current and immediately preceding year

  • Application of capital losses to other income in the year of death, as an option rather than an application to other capital gains of the prior three years.

Preceding 11 months

  • Recovery of unpaid Child Tax Benefits and GST Credits
  • Recovery of overpaid EI premiums in cases where employee did not qualify (i.e. significant or majority owner of a corporation)

Following year

  • Unclaimed medical expenses of the previous year to make a claim for the best 12 month period ending in the tax year.

Next five years

  • Application of charitable donations
  • Deduction of student loan interest

Next seven years

  • Application of Minimum Tax Balances to regular taxes

Next 10 years

  • Application of Business Investment Losses

Next 20 years

  • Application of unused non-capital losses to other income
  • Application of Manitoba Tuition Fee Income Tax Rebate

Indefinite application

  • RRSP deduction when there is RRSP room (or if no longer age-eligible, must contribute to a spousal RRSP if spouse is under age 71.)
  • Capital losses to capital gains. . .until year of death.
  • Unused RRSP deductions. . .until year of death
  • Tuition and education amounts