Dave, Than you very much for your fast reply. I would like to ask you whether I must prepare a substitute Form 1099-R for my Canadian RRSP distribution. Following the TurboTax interview questions (incl., for Canadian pension distribution) does not fill Form 1040, line 5a showing the gross distribution but line 5b (taxable portion) only (both entries should be equal anyway). The Form 1040 does not show Errors. To fill Line 5a, I have to prepare For 1099-R manually from the 1040 Worksheet. Based on other replies in this forum, I understand, I will not be able to e-file my TurboTax return if I prepare substitute Form 1099-R for my Canadian RRSP (issues with Payer ID). So, will my return be acceptable to IRS, if I e-file without entry on line 5a? Thank you.
Do I need to fill a substitute Form 1099-R for my Canadian RRSP pension distribution?
I am a Canadian citizen and a US permanent resident living in California. I withdrew my Canadian RRSP pension in 2021. Canadian Revenue Agency withheld 25% non-resident tax. Now I am filing my US Taxes. Based on postings in this forum, I understand I have the following options:
- Enter the Canadian RRSP distribution on Form 1040, line 5b (taxable amount). However, I cannot add the total amount on Form 1040, line 5a, since it asks me on the 1040 Worksheet to create a substitute Form 1099-R. Based on this forum, I understand I cannot e-file due to problems with the Payer ID (Canadian Payer ID is not recognized). Do I need to enter an amount on Form 1040, line 5a?
- Enter the Canadian distribution on Less Common Income > Miscellaneous Income > Other reportable income to prevent creating the substitute Form 1099-R described above. In this case, the distribution is not recognized as Canadian pension distribution on my California tax return (taxes to Canadian pension have been paid on an annual basis since California does not defer taxes to RRSP but considers them a savings account), and I end up with a huge amount of California tax due.
What should I do? Can I do e-file without entering 5a (see Option 1) do something else to do it by Option 2? Should I file in a different way or will I have to file by mail? If by mail – what Forms, Worksheets and Schedules need to be included? Thank you.
