RRSP and 401k limit

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okinawafl
Posts: 96
Joined: Sun Jul 11, 2021 12:38 pm

RRSP and 401k limit

Post by okinawafl »

May I know would RRSP I contributed this year in Canada affect the 401k limit ?

I heard when Canadian contribute to 401k in U.S., it will reduce their RRSP room in Canada. If this is true, then would the RRSP contributed this year also reduced 401k contribution limit?
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: RRSP and 401k limit

Post by nelsona »

Contributing to your own RRSP is not deductible in US, so this would have no effect on 401(k). In any event, RRSP contributions do not impact 401(k) contribution limits.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
okinawafl
Posts: 96
Joined: Sun Jul 11, 2021 12:38 pm

Re: RRSP and 401k limit

Post by okinawafl »

Great, thanks for letting me to know RRSP contribution won't affect 401k

Would 401k contribution this year affect my RRSP room this year? Can I choose not to deduct 401k contribution, and buy RRSP up to the 2021 RRSP contribution limit list in my 2020 NoA?
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: RRSP and 401k limit

Post by nelsona »

You need to report your 401(k) contributions (and whether you have a pension plan), whether you deduct them of not, on form RC268.
This will determine your deduction limit for the current year, and CRA will then inform you of your deduction limit for the following tax year.

These 401(K) contributions don't necessarily reduce your contribution limit, but do impact your deduction.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
okinawafl
Posts: 96
Joined: Sun Jul 11, 2021 12:38 pm

Re: RRSP and 401k limit

Post by okinawafl »

I printed out RC268 and with reference to your note, now I understand how it works. thanks again!
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