This is a sponsored post written by me on behalf of TurboTax Canada. All opinions are my own.
In my financial planning practice, I’ve seen the good, bad, and complicated ways that the pandemic has impacted the financial lives of Canadians.
One client works in air transportation and had been sidelined collecting CERB and CRB to stay afloat. Another works in an industry making plexiglass barriers and had a record year, collecting a fat bonus. One bought an investment property in cottage country and turned it into a short-term rental. Several have left their careers behind to start their own businesses. Another received stock options for the very first time.
Speaking of the stock market, many people got caught up trading stocks and cryptocurrencies, or they borrowed money to invest in their taxable investment accounts and now must deal with capital gains, losses, and calculate the adjusted cost base on their investments for the first time.
If any of these stories sound familiar, you know that your tax situation will likely look very different this year. I don’t file taxes for my clients, but I do encourage them to prepare their taxes early using what I call a “first 60 days” assessment.
From Free to Full Service
Use tax software to prepare your taxes for filing and gauge your tax situation. Will you be in a position for a refund, or will you owe money? Armed with that knowledge you can use the first 60 days of the calendar year to potentially make an RRSP contribution and reduce your taxes owing (RRSP deadline is March 1st).
TurboTax has an ever-evolving suite of products to not only help the basic T4 employee file their taxes, but also assist the growing complexities of the self-employed, the stock and crypto traders, the short-term rental owners, and more.
Online software has come a long way and there are options for every tax filer. In fact, you can file a simple tax return for $0 using TurboTax Free. This return includes employment income, pension income, tips, RRSP contributions, childcare expenses, and even COVID-19 benefits and re-payments.
Some returns are more complex, such as those involving donations, medical expenses, investment income and expenses, rental property income and expenses, and self-employed income and expenses.
There’s TurboTax Assist & Review Self-Employed, which gives you tax advice and a final line-by-line review from a tax expert to ensure you get every deduction you qualify for and that your taxes are filed correctly.
You can search for industry specific deductions, and the service covers income and expenses from ride sharing, online sales, consulting, real estate, and more.
This would be a good fit for the first time Airbnb host renting property in cottage country, or for someone that started an online side hustle selling products or courses. TurboTax Assist & Review Self-Employed costs $109.99 per return, and you only pay when you file.
If you’re self-employed and would prefer someone else do your taxes for you, but you’d rather not pay a pricey accountant to do it, then TurboTax Full Service Self-Employed would be a good option. For $249.99 per return, you can turn it over to a team of tax experts with an average of over 10 years’ experience in your specific industry who can find all the deductions to help reduce your taxes.
For those with more complicated tax issues arising from investment income and expenses, such as reporting individual stock, ETF, and cryptocurrency sales, or from rental property income, expenses, and refinancing, there’s TurboTax Full Service Premier.
Here you’ll connect with TurboTax experts with experience in investment and rental property taxes. Whether you’ve purchased your first investment property (or sold one), bought or sold stock in a taxable account, or invested in cryptocurrency (yes, selling crypto for cash or exchanging Bitcoin for Ethereum is a taxable event), your live tax expert will get to know your unique situation, search 400+ deductions and credits for you, and offer a full expert walkthrough before filing.
TurboTax Full Service Premier costs $149.99 per return ($179.99 as of April 1st) and your taxes will be done in just a few days, assuming you have all your documents ready. Your tax expert will help you report sales of stocks, ETFs, and cryptocurrency, calculate capital gains and losses, with adjusted cost basis missing identification and video guidance, and offer step by step guidance reporting rental property income and expenses.
Final Thoughts
While there weren’t a lot of changes to the Income Tax Act in 2021, that doesn’t mean your personal tax situation hasn’t changed.
If you started a new business or side hustle, bought or sold a rental property, traded stocks or cryptocurrencies in a taxable account, or had to deal with a new financial situation that will impact your taxes then I encourage you to assess your situation in this first 60-day window and use a tax software option that aligns with your situation.
TurboTax Giveaway!
Four lucky readers can enter for a chance to win a complimentary tax code, valid for ANY online tax product at turbotax.ca, valued at up to $279.99 each!
To enter, leave a comment below and share something (anything!) about your taxes this year. Are you an early tax filer, or a procrastinator? Will you owe money, or do you expect a big refund? Did your tax situation change over the past 1-2 years?
This contest is open until Sunday February 27th at 5 p.m. EST.
