I have a client whose wife died in late March 2018. He remarried in May 2018. He wishes to do pension income splitting with his deceased wife on her final 2018 by transferring some of his eligible pension to her rather than his new wife. Is this permissible and if yes how would this be handled in TaxCycle?
Not sure how or if the ITA covers this scenario, but the instructions at the top of the T1032 sound like it might be allowed - if the date of death was at least 90 days into the year.
How are you preparing the wives’ returns? I don’t think TaxCycle can do a return coupled with 2 spouses, so you would have to do one of the wives separately - probably the deceased? You can enter the appropriate names and SINs on the T1032 in each file - just override the defaults as necessary. Then, in the coupled return, I would make sure the split amount doesn’t automatically show up on line 116 of the living spouse (not sure if overriding the SIN on the T1032 will prevent that).
Thanks for your comments. CRA has recently informed me that splitting can be done with his deceased wife even though he remarried in the same year, assuming she died at least 90 days after Jan 1. They suggested paper filing the two returns with notes attached. His new wife could be efiled as usual.
Unless his spouse passed away on b March 31st there isn’t an issue on this situation.
90 days is March 31.