Assignment Problem - (Other Income And Deductions Including RESP)
Viva Houde's divorce settlement resulted in her having custody of her two children. Her daughter Lacy is 8 years old and her son Mark is 10 years old. They are both in good health.
The agreement calls for her to receive child support payments of $2,000 per month, as well as spousal support of $1,500 per month. During 2017, she received all of these payments.
In order to get a fresh start in life, she enrolled in a co-op program at Western University in London, Ontario. She was very successful during the winter term (January through April, 2017). The program requires her to work in her field during the summer, with her first placement being Timmins, Ontario during the period May to August, 2017. Her employment income for this period was $8,000.
In late August she returned to London and resumed full time studies during the fall term (September through December, 2017). She was also able to obtain a part time job in her field in London. During these four months she had employment income of $1,600.
The eligible moving costs associated with moving herself and her children to Timmins for the summer work term totaled $1,200. The costs for the move back to London were $1,350.
In addition to her support payments and employment income, Viva received the following amounts:
Scholarship Granted By University For The Fall Semester 4,300
Eligible Dividends Received 2,600
Inheritance From Rich Uncle 22,000
TFSA Withdrawal 4,000
Throughout the year, Viva required assistance with her children. During the period January through April, the costs in London totaled $1,950. In Timmins, she incurred costs of $1,725.
After returning to London for the fall term, her costs for the September through December period were $2,175. During 2017, Viva establishes RESPs for both of her children. She contributes $1,500 to each of these plans.
Required: Determine the minimum Net Income For Tax Purposes that Viva will report for the 2017 taxation year Provide reasons for omitting items that you have not included in your calculations. Also, indicate any amounts that can be carried forward to future years.
Textbook " 2017-2018 edition Byrol&Chen''s Canadian Tax Principles Volume 1"