Which statement about unused registered retirement savings plan (RRSP) contribution room is CORRECT?

Unused Registered Retirement Savings Plan (RRSP) contribution room is the amount of contribution space an individual did not use in previous years. According to the rules governed by the Canada Revenue Agency (CRA), this unused room is not lost. It is automatically carried forward and added to the individual's RRSP deduction limit for the following year. This process continues indefinitely, allowing individuals to catch up on contributions in later years when their income or ability to save may be higher. This cumulative room is reflected on the Notice of Assessment sent by the CRA.

A. Accumulated unused room from multiple prior years can easily result in a total contribution limit that is much larger than the annual limit for a single year.
C. The carry-forward period for unused RRSP contribution room is indefinite; there is no seven-year or other time-based limitation.
D. The ability to carry forward unused contribution room is a fundamental feature of the RRSP system, making this statement incorrect.

1. IFSE Institute, Canadian Investment Funds Course, Glossary and Chapter 6, Section 2: "RRSP Contributions". The text explicitly states that unused contribution room can be carried forward indefinitely.

2. Canada Revenue Agency. (n.d.). Line 20800 – RRSP deduction. Government of Canada. Retrieved from https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/contributing-a-rrsp-prpp/line-20800-rrsp-deduction.html. The section "Unused RRSP/PRPP contributions" confirms that unused room is carried forward.