Final answer:
A contribution to a registered retirement savings plan is a deduction from total income for qualified individuals, helping to encourage retirement savings by deferring taxes until withdrawal.
Step-by-step explanation:
For qualified individuals, a contribution to a registered retirement savings plan (RRSP) is considered B) a deduction from total income. RRSPs allow individuals to defer taxes on the amount they contribute until withdrawal, which is typically during retirement when they may be in a lower tax bracket. This tax treatment aims to encourage saving for retirement by reducing taxable income in the contribution year, thereby postponing the payment of income taxes. It is important to note, that while the question seems to pertain to Canadian RRSPs, similar principles apply to U.S. retirement accounts such as 401(k)s and Traditional IRAs. These defined contribution plans and IRAs are also tax-deferred, and contributions can usually be deducted from your gross income, although the specific tax implications can depend on the account type and eligibility.