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Review of StudioTax 2013 for a Student and a Parent Claiming Tuition, Education and Textbook Amounts (T2202A)

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I recently tested how GenuTax Standard 2013 handles sharing the claim for a student’s university education expenses between the student and a parent. Next, I decided to do similar testing for a student and a parent using StudioTax to see how it handles a T2202A transfer between a student and a parent.

Will StudioTax 2013 Tell You How Much to Transfer from a Student to a Parent?

If a student has tax owing, then the student must use their Education Amount to reduce their payable taxes to 0. The student can only transfer any amount available above what they need to cancel out their own taxes.

GenuTax Standard 2013 will calculate how much the student has available to transfer or carry forward. But does StudioTax 2013?

I set up three tests for a student and parent. In each test, the student worked and received a T4 but the student’s employer had not withheld any tax, CPP, or EI so the student might owe some money to the CRA depending on the total income the student earned.

  • Test 1: the student earned $8 000
  • Test 2: the student earned $15 000
  • Test 3: the student earned $25 000

Test 3 is intended to reflect a lucky student with a great co-op job placement.

StudioTax did calculate how much of the student’s Education amount could be transferred, but it didn’t make it easy to see.

To find the amount that could be transferred at the Federal tax level, in the Forms box on the left side of the screen, under the heading Federal forms, click on the link to Schedule 11.

  • Line 20 on Schedule 11 is the total unused Education amount at the Federal Tax level;
  • Line 23 is the maximum amount which can be transferred at the Federal Tax level; and
  • Line 25 is the amount that will be carried forward at the Federal Tax level.

To find the amount that could be transferred at the Provincial tax level, in the Forms box on the left side of the screen, under the heading of Provincial forms, click on the link to Schedule 11.

  • Line 6 is the total available tuition and education amount at the Provincial Tax level;
  • Line 19 is the maximum amount which can be transferred at the Provincial Tax level.
  • Line 21 is the amount that will be carried forward at the Provincial Tax level.

For my Tests, the program reported that the student could choose to transfer:

  • 1 5000 federally. (I tried to input the full 7320 federally but it properly limited me to the CRA-allowed maximum of $5000 federally.) 6620 Provincially (again, it would not let me type in 7720 which is above the maximum permitted.)
  • 2 2155 federally. 1194 provincially.
  • 3 0 federally. 0 provincially.

These are the same results I received when doing the same tests using GenuTax Standard 2013, which is reassuring.

So StudioTax 2013 does tell you exactly how much you can transfer from a student to a parent, grandparent, or spouse’s or common-law partner’s parent or grandparent. It is not particularly easy to find the information, though. GenuTax Standard makes it a bit more obvious.

NOTE: A student does NOT have to transfer any of the Education Amount if they do not want to.

CAUTION: StudioTax Does Not Tell You This About Transferring Education Amounts

Neither StudioTax nor GenuTax warns you that if a student carries forward the Education Amount to a future tax year, that carried forward amount can be claimed ONLY by the student in future years. It can no longer be transferred to anyone else.

This information is clearly stated in the CRA tax guide but is not stated anywhere that I saw in these online programs.

Will StudioTax Tell Me How Much to Transfer from my Student’s T2202A to Me?

Unfortunately, no.

If you are the parent and you do not owe a large amount on your taxes, it is possible you do not need your child to transfer all of the allowable Education amount to you. You may be able to reduce your taxes payable to 0 by only transferring part of the amount. The unused amount can then be carried forward by the student to reduce the taxes the student will pay in future years.

StudioTax does not, however, “iterate” between the parent’s and the student’s returns to calculate this number.

How Can I Decide How Much of the Education Amount to Transfer to the Parent and How Much to Carry Forward for the Student’s Future Tax Returns?

I could not find any easy way to make this decision. It looks like you have to run test cases. (You also have to run test cases using GenuTax Standard 2013.)

It is much easier to run the test cases in StudioTax, however, than in GenuTax.

The following information assumes you only want to reduce the parent’s payable tax to zero. If you are trying to optimize the tax refund, you can follow the same general steps.

Complete the student’s tax return first, but do NOT send it in yet.

That will tell you the maximum amount that can be transferred federally and provincially from the student to the parent.

To test different transfer amounts, in StudioTax, you just

  1. Click on the Dependants button in the top navigation bar.
  2. Type the values for the Federal and Provincial transfer amount that you are testing in the respective boxes.
  3. Click OK.
  4. Check the Balance owing in the Summary box on the left side of the main StudioTax screen.
  5. Repeat with a new set of values for the Federal and Provincial transfer amount.

This requires that you
Run a first case for the parent assuming a transfer of 0 for both the federal and provincial Tuition transfer fields.

If the parent owes no taxes, don’t transfer anything to the parent. Report 0 for the transfers on the Student’s Schedule 11’s (and the paper T2202A), and submit both tax returns when you are sure they are correct.

If the parent does owe taxes, enter the maximum possible for the Federal and Provincial transfer.

If the parent still owes taxes, update the Student’s tax file (both Schedule 11’s (and the paper T2202A)) to show that all of the permitted Education amount is being transferred. Submit both tax returns when you are sure they are correct.

If the parent does not still owe taxes, you may want to check how little you need to transfer to ensure the Parent’s taxes are reduced only to zero.

Choose values for the Federal and Provincial transfer which are greater than 0 but less than the maximum permitted transfer. Keep checking the Balance owing in the Summary box until it gets to zero. Update both Schedule 11s (and the paper T2202A) for the Student’s tax return when you find the optimum amount to transfer. Carefully check both tax returns and submit them when they are correct.

Remember to File Your Actual Tax Returns!

Once you’ve finished optimizing the transfer, the tax returns must be filed. StudioTax does NOT file the tax returns automatically. You must follow the on screen instructions to NETFILE each of the 2 returns or print out a paper copy of each of the 2 returns and mail them in.

If you are NETFILEing or sending in a paper return, you do not have to include the Form T2202A with the amount being transferred. Keep it though for 7 years in case of an audit.

How Do I Use StudioTax to Input the Education Amount on a Student’s and a Parent’s Tax Return?

StudioTax does not provide much help for completing the tuition, education and book amounts for a student or the transfer amount for a parent. The process is pretty simple, though, if you understand that the Student fills out a federal Schedule 11 and a provincial Schedule 11 plus updates his or her paper T2202A form from the educational institution. The parent fills out some information on their dependant student which results in a line on their T1 Federal tax calculation and on their provincial or territorial tax calculation form.

Here are some details on what to enter on various screens when completing both the Student and the Parent’s tax return using StudioTax. NOTE: You must complete the Student’s tax return first so that you know the maximum education amount that can be transferred to the Parent’s tax return.

Completing the Student’s Income Tax File Using StudioTax 2013

Most of the return is completed like any other tax return. I will only describe here the parts specific to being a student and/or transferring or carrying forward the education amount.

Completing the Test Tax Return for the Student
After completing the name, address, marital status and SIN information screens,
the T Slips and RL Slips screen opens.

Click the select the box beside T4 and beside T2202A Tuition, Education, and Textbook Amounts Certificate.

Click Next.

On the next screen

Click to select the box beside
Tuition: Check if you are claiming tuition fees.

Click Next.

On the Tuition Information screen
Only students can claim tuition amounts. Amounts transferred from dependants are claimed as dependant. See line 324 in the CRA guide for more information.

Tuition and education amounts
Unused tuition and education amounts from your 2012 Notice of Assessment or Notice of Reassessment
Federal amount: __________
Provincial amount: __________

Use T2202(A) slip to enter the 2013 tuition and education amounts.
Use the Federal Schedule 11 to enter additional tuition and education amounts not declared using the T2202(A) slip.
Use RL-9 to enter the Quebec tuition amounts.

Click Next.

Our student is in first year so she does not have any unused amounts from her 2012 tax return. There is nothing that needs to be typed on this screen.

On the More Federal Tax information screen
Our student does not have any interest yet on any student loans so there is nothing that needs to be typed on this screen.

On the Provincial Credits screen.
Our student does not have any claim for Student residence costs, so nothing needs to be noted on the Provincial Credits screen.

Click Finish.

In the Forms box on the left side of the screen, scroll down then click on

T2202

to select and open it.

For the line
Eligible tuition fees part-time and full-time sessions
I typed 3600

Number of months for: Part-time, Box B:
I typed 0

Number of months for: Full-time, Box C:
I typed 8

No prompt is made suggesting transferring the Education amount, nor does it suggest visiting Schedule 11 even though the program has now used the information from the T2202 to start completing this Schedule.

From the Forms box on the left side of the screen, under the Federal Forms heading, click on:

Schedule 11
Inspect what the program has filled in:

  • The eligible tuition fees paid for 2013, line 320, include the $3600 from the T2202(A).
  • The number of full-time months, 8, has been completed for lines 6 and 7, leading to the calculation of the Education amount and the Textbook amount total on line 322 of $3720.
  • The amount available to transfer or carry forward, $7320, is listed.

To make a transfer to your spouse or common-law partner, it is necessary to check the box beside Transfer to your spouse or common-law partner. (If you are creating linked returns that should lead to updating your partner’s tax file.)

If not, you must decide how much you want to transfer to a parent or grandparent or your spouse or common-law partner’s parent or grandparent and type it in yourself in Box 24. The program then will calculate any leftover amount and use it to report the Unused federal amount available to carry forward to a future year on line 25.

This is only for the Federal portion of your Education amount. You must also complete the same information for the Provincial portion of your Education amount.

In the Forms box on the left side of the screen, under the Provincial forms heading, click on the link to:
Schedule 11

Inspect what the program has filled in:

  • The eligible tuition fees paid for 2013, line 5914, include the $3600 from the T2202(A).
  • The number of full-time months, 8, has been completed for line 5918.
  • The total available tuition and education amount, $7720, is reported on line 6.

If applicable, the amount of the Education amount claimed for 2013 is reported on line 13.
The amount available to transfer $1194, is listed on line 19, and the amount that will be carried forward is listed on line 21.

To make a transfer to your spouse or common-law partner, it is necessary to check the box beside Transfer to your spouse or common-law partner. (If you are creating linked returns that should lead to updating your partner’s tax file.)

If not, you must decide how much you want to transfer to a parent or grandparent or your spouse or common-law partner’s parent or grandparent and type it in yourself in Box 20. The program then will calculate any leftover amount and use it to report the Unused federal amount available to carry forward to a future year on line 21.

Completing the Parent’s Income Tax File Using StudioTax 2013

Here, I will only describe the parts specific to having a child transferring the education amount to the parent.

For the Parent’s Tax Return
On the T Slips and RL Slips screen
Do NOT click the box to select T2202. Only the student reports this form.

When you have selected the appropriate forms, click Next.

On the next screen
Click to select the box beside
Dependants: Check if you are claiming child care expenses and/or if you have dependants.

This is the box you select to get to receive the Education amount transferred from your child.

Click Next.

After you have input various screens of information, the
Child Care Expenses screen
 will open.

Click on the Add button

The Dependant Name screen will open.
Type in the information for your Child in the appropriate fields.

  • First Name:
  • Last Name:

Click OK.

Now you can enter the information on the fields of
the Child Care Expenses screen

In the Date of Birth section, type in the Year: and select the correct Month: and Day: from the drop-down lists.

In the SIN section, type the student’s social insurance number.

From the drop-down list, select your Relationship with the student.
I selected Daughter.

In the Net Income field, type the student’s net income or click to select the box beside Income is Nil.

Click to select the appropriate choice of

  • Healthy
  • infirm
  • Disabled

as defined by the CRA elsewhere.

If applicable, click to select the check box beside NOT living with the tax payer.

In the Tuition transfer section,

  • In the Federal: box, type the amount to transfer Federally from your child student.
  • In the Provincial box, type the amount to transfer provincially or territorially from your child student.

Ensure the check boxes are selected under the heading Claim: for both the Federal and the Provincial Tuition transfer.

If applicable, fill in any other fields not related to the Education amount.

Click OK.

StudioTax 2013 will now use the transferred Education amount to re-calculate the taxes owed. You can re-open this Dependant’s screen at any time by clicking on the Dependants button in the top navigation bar.

You can change the amount for the Federal and Provincial Education amount on the Dependants screen until StudioTax reports your Balance Owing as 0 or less in the Summary box at the left side of the screen.

That is the end of the sections of StudioTax relating to the Education amount. Do not forget to file the parent and child’s return after they have been updated and reviewed for accuracy!

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Have you used StudioTax to claim or transfer the Education amount for your own tax return? Please share your “learning” experiences with a comment.

How to Use StudioTax 2013 for a Simple Retired Person’s Tax Return (T4AOAS, T4AP, T4A, T4RIF, T5)

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Recently I had a chance to test using StudioTax 2013 for a retired relative’s tax return. This relative had already calculated her taxes using a pencil, the paper forms and a calculator. I used her T slips and her personal information to complete the same tax return using StudioTax 2013. Here’s how I did that and what the results were.

This person was

  • a Canadian citizen
  • still living
  • residing in Ontario at year end
  • single with no change in marital status or common law status during 2013

What You Need to File a Simple Tax Return for Someone Receiving CPP, OAS, and some RRIF and Interest Income

  • Your Social Insurance Number
  • For the company pension payments received, a T4A
  • For the CPP received, a T4AP
  • For the OAS received, a T4AOAS
  • For the RRIF income, a T4RIF for each RIF
  • For the interest income, a T5 for a GIC and the added up amount for a bank account
  • A copy of the StudioTax 2013 software downloaded to and installed on your computer

What Was the Result of Using StudioTax 2013 to Calculate a Pensioner’s Income Tax Return?

I am not a trained tax professional, nor do I even look like one. I can only say that the program generated the same results as hand calculation did. For me, that is acceptable.

It is important to note that the program did not prompt me to enter her bank account interest. I had to remember to add that in myself.

How to Use StudioTax 2013 to Calculate a Retired Person’s Income Tax Return

  1. Double click on the StudioTax 2013 icon.
  2. Click on the button: Create a new return
  3. Read the information about the Quick Start Wizard, then click Next.

The information on the first few screens is used to fill in parts of Page 1 and Page 2 of your T1 General 2013 Tax Return form.

  1. From the Title: drop-down list select the appropriate honorific.
    For example, I selected: Miss
  2. In the appropriate box, type your First Name:, Last Name: and Initial.
  3. Select the appropriate choice by clicking on the radio button beside:
    • Check if this is your first return.
      For example, if you have never filed a Canadian income tax return before, click the dot beside this.
    • Check if your name changed since your last return.
      For example, if you legally changed your name after a marriage, divorce or deed poll, click the dot beside this.
    • Otherwise, check to confirm that your name did not change since your last return.
      For example, if you’ve been filing your taxes for years under this same name, this in the one to click the dot beside.
  4. In the appropriate box, type
    • your Social Insurance Number and
    • the Year of your birth.
  5. From the drop-down lists, select the month and day of your birth.
  6. Click Next.

On the second screen

  1. In the appropriate boxes type
    • your address
    • your postal code and
    • your telephone number/s.
  2. From the drop-down lists, select
    • your province for your mailing address
    • which province you were resident in on December 31, 2013.
    • if applicable, the date you moved your residence to a province or territory
    • if applicable, your current province or territory if different from the mailing address
    • if applicable, your province or territory of self-employment
  3. Click to answer if your home address is the same as your mailing address.
  4. Click Next.

On the third screen

  1. From the drop-down list, select whether you are
    • married,
    • common law,
    • single,
    • widowed,
    • divorced or
    • separated.
  2. Click the box if your marital status changed during the year.
  3. Click to select the radio button If you want to link your income tax return with your spouse’s (which allows the computer to try to optimize who claims certain tax deductions and credits).
  4. If you selected Married, Common Law, etc, type in the information in the appropriate boxes and select from the drop-down lists for your spouse’s
    • First Name:,
    • Last Name: ,
    • Spouse’s SIN:,
    • Spouse’s Date of Birth Year:,
    • Month:, and
    • Day:.
  5. If your spouse is a non-resident, check the box.
  6. Click Next.

On the fourth screen
If you became a Canadian resident or ended your Canadian resident status, click the appropriate box and select the appropriate date.

If you are a newcomer, read the information about non-refundable tax credits.

Click Next.

On the fifth screen
If this is a return for a

  • deceased person
  • pre-bankrupt person

click the appropriate box, select the appropriate date and if applicable, enter the income after the bankruptcy.

Click Next.

On the sixth screen
Click to select the radio button beside the appropriate choice for

  • your language of correspondence with the CRA
  • whether you are applying for the GST/HST credit
  • whether you held foreign property, including stocks outside of a RRSP, with a cost of more than $100 000 CAN.

Click Next.

On the seventh screen
Click to select the radio button beside the appropriate choice for

  • Are you a Canadian citizen
  • Can the CRA give your address etc to Elections Canada

Click Next.

On the eighth screen
Finally, something TAX related!

This screen lists the tax forms you have received that you want to use to complete your return.

Read through the list and if you have one or more of those forms, click to select the box beside it.
For example, for my test return, I clicked to select the boxes beside

  • T4A
  • T4RIF
  • T4A(OAS)
  • T4A(P)
  • T5

Click Next.

On the ninth screen
Check the box beside any of the common tax situations that apply to your return, if you are claiming

  • RRSP contributions and/or repaying HBP or LLP
  • tuition fees
  • charitable donations
  • child care expenses and/or dependants
  • political contributions
  • medical expenses

Click Next.

The next section of the program begins.
This is where it lets you type in the information found in each box of your various T slips.

T4A
For my specific test, the T4A screen opens first.

My relative had one T4A for a company work pension.
From that T4A, I had information to enter for

  • Box 16: pension
  • Box 22: income tax deducted, and
  • Box 28: Other employment income

The program offers me the choice of entering several T4As if I have them. To do that, it is set up with several columns.

Each column is headed with the “name” of the T4A that is being entered, such as T4A(1), T4A(2), T4A(3) etc.

On my computer, you can’t see the third, fourth, and fifth T4A slips unless you click on the arrowhead pointing right above the line that says T4A(1)  T4A(2).

There are also many, many boxes of information that could be on a T4A and which need to be reported. To see them all, there is a scroll bar with arrowheads that displays vertically at the right hand side of the screen.

I only have the three numbers to enter.

  • I click once on the empty box beside 16 and below T4A(1), and I type the amount of pension received as reported in Box 16 of my relative’s T4A slip.
  • I then click once on the empty box beside 22 and type the amount of tax withheld, as stated on the real T4A slip.
  • Finally, I click once on the empty box beside 28 and type in the Other Income.

If I had another T4A slip I would click on the appropriate empty boxes under the column heading T4A(2) and type in that data. I would repeat this with a new column for each new T4A slip.

Now that I have entered all the data that is on my relative’s T4A slip for their company pension, I click on the Next button.

T4RIF
For my specific example, the next screen that opens is for entering data for T4RIFs. My relative had 2 T4RIFs to report.

Fortunately, T4RIF forms are easy to type into the program.

For the first form, in the column under the heading T4RIF(1), I click on the empty boxes beside the appropriate box numbers and type in the amounts. So I click and type

  • for Box 16, the amount received from the RRIF
  • for Box 28, the amount of income tax deducted before my relative received the payment

Then for the second form, I repeat the process but under the heading T4RIF(2).

If there was another T4RIF to enter, I would have to click on the scroll bar above the heading T4RIF(2) to see another blank column headed T4RIF(3).

Once I’ve entered the numbers for the two RRIF slips, I click Next.

T4A(OAS)
For my specific example, the next screen that opens is for typing in the information for my relative’s T4A OAS slip. This is a tax slip for the Old Age Security payments she received.

In the column under the heading T4AOAS(1), I click on the empty boxes beside the appropriate box numbers and type in the amounts. So I click and type

  • for Box 18, the amount received from OAS
  • for Box 22, the income tax deducted

It’s a bit strange to see column headings for T4AOAS(2) etc. I don’t think there is any way that one person could receive more than one OAS income but I could be wrong. (If you know how someone could get 2 T4A(OAS) slips, please share your insights with a comment.)

Click Next.

T4A(P)
For my specific example, the next screen that opens is for typing in the information for my relative’s T4A(P) slip. This is the tax slip for the Canada Pension Plan, CPP, payments she received.

In the column under the heading T4AP(1), I click on the empty boxes beside the appropriate box numbers and type in the amounts. So I click and type

Click Next.

T5
For my specific example, the next screen that opens is for typing in the information for my relative’s interest income earned on a GIC.

In the column under the heading T5(1), I click on the empty boxes beside the appropriate box numbers and type in the amounts. So I click and type
for Box 13, interest from Canadian sources

Click Next.

HBP, Transit Costs, Student Loans and Disability Amount for Self
If applicable, on this next screen you would enter

  • Your Home Buyer’s Plan amount
  • Public Transit Passes amount
  • Interest paid on your student loans
  • Disability amount for self

My relative did not have any need to enter this information.

Click Next.

Ontario Credits
The next screen contains very important information for those eligible to apply for the Ontario Trillium Benefit and/or other Ontario Credits. If any of the information applies to you, copy down the information for later use.

Click Next.

Last Wizard Screen
Read the message.

Click Finish to continue.

You will now return to the main StudioTax 2013 screen.

Reviewing Your Income Tax Report Generated by StudioTax 2013 for a Retired Person’s Tax Return

Now that you are back to the main StudioTax screen, you can start reviewing your tax forms.

Down the left side of the screen is a list of each of the forms commonly used and filed for an income tax return.

You will want to click on each form in turn to read in the main window what information has been entered for your tax return. Look for errors and omissions. Do NOT submit your taxes without reviewing them for accuracy!

I started by clicking on the heading T1 Page 1 on the list on the left side of the screen.
That opened the first page of my relative’s T1 General for review.

How to Correct an Error Using StudioTax 2013 (Before Filing Your Return)

While reviewing T1 Page 2, I noticed an error in line 115, Other pensions or superannuation. Instead of the 10 000 reported on my T slip, it said 1 000. To check the source of the error, I double clicked on the 1 000.

The StudioTax program opened the form that resulted in the 1 000 being displayed. I could see that the amount Computed from T4A slip was incorrect. I could not correct it here, however.

Instead, I had to look down the list at the left side of the screen for the heading T4A under the T slips subheading.

Clicking on that T4A link opened the screen where I entered each of the T4A slips. Here I could see where I entered 1 000 instead of 10 000 for Box 16. I corrected the entry.

When I clicked on the link for the T1 Page 2 slip, on the list on the left side of the screen, and checked the value for line 115, it now correctly reported 10 000. My taxes had also been re-calculated.

Caution! Remember to Review Each Form!

It is important to review all of the numbers you entered.

If possible, it is also valuable to review the actual Schedule 1 and Provincial Tax forms. StudioTax 2013 does not prompt you for all situations.

For example, remember I said that my relative had $49 of interest from her bank account?

Because the amount was under $50 she was not sent a T5 slip.

StudioTax did not ask her if she had any other interest income to report.

I had to notice on her T1 Page 2 that she needed to report the $49 interest on line 121 and on Schedule 4.

So from the list at the left side of the screen, I clicked on Schedule 4.

Section II of the form was already completed with one line: “From information slips” and the interest on her GIC that was provided by a T5.

I typed on the second line “CIBMO bank account interest” and the value, $49.

The form was then updated and the taxes were re-calculated.

Conclusion

After reviewing all of the information on the forms and schedules, and after making the two corrections I mentioned above, I compared the StudioTax results with the results my relative arrived at by completing the forms by hand. The answers were identical.

I am not educated or accredited to calculate taxes. I can only state that both the program and the hand calculations resulted in the same values on both tax returns.

Next Steps for Using StudioTax 2013

First I saved the return by clicking on the Save icon at the top of the screen.

Next, I could submit the tax return using NETFILE. In this case, my relative had already mailed in a paper return, so I didn’t.

IT IS CRITICAL TO REMEMBER THAT YOU MUST EITHER
PRINT AND MAIL YOUR RETURN; OR
NETFILE YOUR RETURN BY APRIL 30 2014.

StudioTax does NOT automatically submit your tax return. You must go through its instructions and NETFILE or print out your forms and schedules and submit them, along with the appropriate slips, by mail.

I will not list the NETFILE instructions here because I did not NETFILE this test case.

Related Reading

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Did you use StudioTax to calculate and/or submit your return this year? Did you find anything you had to correct when you reviewed your forms and schedules before submitting? Please share your experiences with a comment.