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The tax-free savings account is the best shot most Canadians have for sheltering investment income from the taxman. It’s simple, accessible and flexible. So why are tens of thousands still getting tripped up over technicalities?

The rule is simple enough. If you have maxed out your annual contribution and go ahead and withdraw money from a TFSA today or anytime this year (2014), you can’t put it back until the next calendar year: i.e. 2015. Basically, if you decide to replace or re-contribute all or a portion of your withdrawals into your TFSA in the same year, you can only do so if you have available TFSA contribution room. If you re-contribute but do not have room, you will have over-contributed to your TFSA in the year and you’ll get dinged with a penalty.

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More than 100,000 Canadians fell afoul of this in 2010: understandable because the program became operational only early in 2009. But much ink and airtime has been expended about TFSAs since then so you’d think the problem would have vanished by now. But according to the Canada Revenue Agency, almost 55,000 taxpayers still fell afoul of this rule for the 2013 tax year.