Tax-Free Savings Account

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A Tax Free Savings Account or TFSA is a proposed account that provides tax benefits for savings accounts in Canada. Unlike a Registered Retirement Savings Plan (RRSP), TFSA contributions are made from post-tax dollars. Withdrawals are tax free, and create an equal amount of contribution room. From its early descriptions it is similar to the American Roth IRA, with more freedom to withdraw money.

The TFSA program was proposed on February 26, 2008 by the federal government of Canada. TFSAs would become available in 2009 if the Parliament of Canada passes the necessary amendments to the Income Tax Act and they receive royal assent.

[edit] See also

• Taxation in Canada

[edit] References

• Tax-Free Savings Account (TFSA)