Hello,

I have my LIRA account set to be converted at 71 in the settings for that account.

I also have CPP and OAS to start at age 65 so I will get pension income that year for my wife and my self. (Enabling pension splitting and pension amount tax credit)

When I run the basic time machine, the output has partial conversion of the LIRA at age 65. I cant seem to find a way to have MRA delay that until 71. Am I missing something?

As you saw, the TIME MACHINE allows partial conversions of LIRAs and DCPPs. It does this by automatically allowing withdrawals from LIRAs after 65, regardless of when you set to convert it, if you want or need the money. We assume you will arrange it with your LIRA provider to make the required partial conversion to an LIF or RRSP/RRIF as allowed by your province's legislation so that the money can be withdrawn. That flexibility is usually what users want.

If you want the money, you would enter an AUTOMATIC withdrawal. People often do that to make a partial conversion to get the pension sharing and the pension tax-credit if they have no other sources of pension income. Not your case, but I need to mention it.

If you need money, the TIME MACHINE makes withdrawals from your accounts following your withdrawal PRIORITIES. You can set a limit of 0 for the LIRA account for the years before age 72 so that it will skip it and get money from accounts further down in the list instead. You will need the create a new PRIORITIES entry for the years 72 and up to allow withdrawals again.

Understood, and thanks for your quick response.

FYI, after further reading, it appears that CPP and OAS do not qualify for the pension income amount tax credit of $2000 so we will still need to convert or partially convert LIRAs or RRSPs at 65.

MRA has automatically partially converted my LIRA, but I dont see anything for my wife. From a tax persecptive, would it not be best that we both have this tax credit? (I assumes MRA willapply the pension amount tax credit of $2000 when calculating taxes that are due/paid each year?)

MRA has me partially converting my LIRA when I am 66, but wouldnt I want to do that when I am 65?

Yes, CPP and OAS do not qualify for pension.  I was focused on answering your question of why the LIRA was being converted.

This is a case of you want the money, for the pension split and tax credit. You can set up an AUTOMATIC withdrawal of $4,000, it'll be split with your wife and both of you will get the pension tax credit in the TIME MACHINE.  The year reports will show you the taxable income pre- and post-pension income splitting for both you and your wife.

I also explained that it also makes conversions after 65 if you need the money. But there's no optimization done by the TIME MACHINE, that's where the Withdrawal Optimizer comes in.

Got it, thanks for your patience and help