CASE:

Ana Khanna is 39 years old and has custody of her two children from a previous marriage. The son is 7 years old and the daughter is 9 years old. They are both in good health. She is currently married to very successful musician who earns an income in excess of $250,000 per year.

As her children are now in school most of the year, she has decided to pursue a career in the filming industry. To this end, she has enrolled, on a full time basis, at the Toronto Film School. Her studies began on January 1, 2020.

As she was very successful in her first term of studies, she was able to obtain summer employment as an assistant in a film production in Victoria, British Columbia. As this location was over 4,000 kilometers from Toronto, she and her children moved to a rented cottage in Victoria for the period June 1, 2020 through September 1, 2020. As this was a temporary move, it was accomplished using a rented van at a total cost of $2,685.

During her summer in Victoria, Ms. Khanna required someone to take care of her two children while she was at work. For this service, she paid a local retired teacher $325 per week for a period of 12 weeks. She has the appropriate documentation to support these costs.

She returned to Toronto on September 1, 2020 in order to resume her studies at the Toronto Film School. Once again, the move was accomplished using a rented van. The total cost was $2,824. During the fall term, she found a part time job working in a Toronto studio.

On January 1, 2020, Ms. Khanna did not have a Tax Free Savings Account (TFSA). In May, 2020, she opened a TFSA and deposited a total of $7,500. Her partner also made a contribution in the amount of $12,000.

During 2020, Ms. Khanna received the following amounts:

Wages from Victoria employment $ 16,800

Wages from Part Time Employment In Toronto 3,200

Scholarship Granted By Toronto Film School for Sep 2020 Semester 2,000

Eligible Dividends Received 4,800

Child Support Received 7,200

Inheritance from Grandmother 20,000

TFSA Withdrawal 12,000

During March, 2020 Ms. Khanna establishes RESPs for both of her children. She contributes $3,000 to each of these plans.

Required:

1. Determine the minimum Net Income For Tax Purposes that Ms. Khanna will have to report for her 2020 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.
2. Provide any advice you feel would assist her in planning future actions concerning the RESPs that have been established for her children.