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US-Canada Tax Questions / Re: Dual citizen Roth IRA Conversion
« Last post by Johnny on July 16, 2018, 05:44:40 PM »
Thanks for your response!

Well, I haven't officially moved here yet so I'm not a BC resident. I think I'm still considered a "visitor" since I'm totally off the Canadian radar. I've been back for a month but I think when I go in to get my drivers license and apply for MSP would be the official start date of my residency. Using the 183 day rule, however, I would be considered BC resident for 2018 since I arrived before July.
US-Canada Tax Questions / Dual citizen Roth IRA Conversion
« Last post by Johnny on July 16, 2018, 02:53:01 PM »
I am a US/Canada dual citizen returning to Canada after a 20+ year absence. I just moved to BC so I believe I will be considered a resident of BC for 2018.

I took two years off working and would like to take advantage of low income by converting my American Traditional IRA to Roth IRA in the USA this year. I am not sure if this conversion is covered by US-Canada tax treaties...I donít want to be double-taxed. Iím not even sure if I have to report this American ďincomeĒ in Canada.

Thanks so much
Hi Mtler

I hate the idea that the account needs to be liquidated. Depending on the size of the account you can save a significant portion of the account from tax if you had it managed with a Canadian broker.

How much approximately is in the account and how high is your income currently?

Hi dchs

You'll definitely want to reach out to a Canadian cross-border investment advisor to ensure you don't miss any planning opportunities, however, let me try and outline some issues:

Yes, naming them as beneficiaries will be important
Do they have a US ITIN? If not, they may need one before inheriting the US accounts, depending on the broker
You'll want to discuss estate planning issues with a Canadian lawyer to ensure you don't have dual filing requirements when you pass (depending on who the executor is)
Setting up a trust and then transferring to Canada is possible, but highly complex (we can chat more if this interests you)

It's likely simplest to keep the Canadian beneficiaries on the account until you pass. Be careful however. If you have a Canadian executor of your estate you may run into Canadian trust filing requirements.

Hope that helps a little. Please let me know if you have additional questions.

Hi Will

Thanks for the post. You'll want to sit down with a cross border professional to work through this in more detail, however I can give you some guidance on this post. With respect to your question it's often more efficient to pull from your Canadian and US non-registered accounts first. Any time we can continue to defer US and Canadian registered accounts like RRSP, RRIF and IRA we should do so.

You'll find that you'll be forced to pull from your RRIF in your 70s, there you won't have full control over the complete deferral of registered accounts. Also, I would normally suggest that you hold off as much as you can on pulling from your IRA (RMD will be required) as they accounts can be passed down to the next generation tax free. The savings on this "stretch" can be significant.

Hope that helps and please let me know if you have any other questions.


Looks like Iíll have 2 weeks to move my Fidelity account to Canada. I recently changed my address on the account to my Toronto address and they sent me a email explaining my options, all of which are not great. Iíve reached out to some investment advisors in town but most can help unless I liquidate all the positions. The problem is (which is a good problem to have I guess) I have significant gains on a lot of my positions that I would rather not pay tax on at the moment. Many of these positions I plan on holding for many more years.

Do you know of any investment brokers that I can transfer my US stocks to?


Depending on the size of your account I would suggest reaching out to an experienced cross-border investment advisor. Lots of Canadian brokers don't have experience with the US side. We're working on a list of cross border investment advisors and brokers here.

Let me know if I can help.

US-Canada Tax Questions / Canadian as a beneficiary of IRA of USA
« Last post by Mtler on July 14, 2018, 10:28:33 AM »
Dear Phil,
I am a resident and citizen of Canada living in Quebec. Recently I inherited a Roth and Rollover Account (IRA) and a Transfer on Death Account (TOD) from my relative who was a US citizen and resident.
Because I am a non-resident alien I have to liquidate all of the assets and it may be distributed to me as a lump-sum. My question is that when I fill Form W8EBN, could I entitle lower WHT from 30% to 15%? Is this "periodic payment"? Then, when I fill Canada Income Tax Return, what should I do except claiming foreign tax credit to avoid being double taxed? What is your advice?
For my opinion, TOD is a brokerage account. Is it subjected tax as GAIN or Income in US? And is it subjected tax in Capital Gain or Gross Income in Canada?
Thank you very much!
I'm going to be in the same position in a few months. I recently asked this question to Fidelity and they said I could keep my IRA accounts but my taxable account would have to be moved.

I would call a few Canadian discount brokerages (Questrade, QTrade, etc.) and see if they can directly transfer your assets from Fidelity without having to liquidate them. This post seems to suggest it is possible:
I am a US citizen by naturalization (also Can citizen), reside in US, my two children are Canadian citizens, residing in Canada.  At my death I would like to leave them each (50/50) the contents of a brokerage account I have in the US.  The account has capital gains in it now and will (hopefully) continue to accrue capital gains.  My preferred goal would be to leave it to them and minimize taxes for them.  Ideally by having the basis for their inheritance to be set to the value at the time of inheritance, and to thus reduce taxes due on the inheritance.

I've researched possible methods of doing this:
1. name them as beneficiaries of the brokerage account, payable/transferable on death. 
2. name my estate as beneficiary and provide in my will for their inheritance of the contents of the brokerage account, my estate paying any necessary probate costs.
3. setting up a trust in the US, and upon death migrate the trust to Canada my making one of my children the trustee, then liquidate the trust in Canada
4. setting up a trust in the US, and upon/after death transfer the capital in the account the year after death (which presumably means selling the securities for cash and paying US taxes on the capital gains??)

Could please you comment on which of these might best meet my goals.  If a trust is used, should your services be integrated with my local legal services to create such a trust?
US-Canada Tax Questions / American Doctor in Canada with tax questions
« Last post by Will_slack on July 03, 2018, 07:25:07 AM »
2 years ago I moved from California  to Victoria to retire with my husband. We are working from our retirement and estate plan with our US wealth manager however he has very little experience on the Canadian rules. Weíve been with him forever and would like to maintain the relationship. However we donít want to make any decisions that will result in negative Canadian tax consequences.

One of my main questions is what investment account should we draw from first? Iíve listed out our investments below (all estimates):

- $200,000 RRSP from when I worked in Canada early in my career
- $500,000 IRA
- $100,000 ROTH
- $1,200,000 investment account

In case this make a difference in the planning we have 3 kids (1 in Canada and 2 in the US) that will be inheriting the residual of our estate when we pass.

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