Where to enter Canadian TFSA, RRSP, RPP Investment gains in Turbo ax?

[ginazhong]

Hi,

I am a Canadian and moved to US in July 2021. I believe I need to report the second half year of income from my Canadian accounts (TFSA, RRSP, bank accounts and etc) to IRS.

-I have stocks and mutual funds in my TFSA and RRSP account, where should I enter gains/losses in TurboTax?

-What additional forms do I need to submit?

-I only need to report the income for the period after I became US resident, right?

- Do I need to report employer contributions and gains from RPP (Employer Registered Pension Plan)?

Thank you!

[RobertB4444]

Yes, the US taxes all income received inside the country while you are a resident.  You will enter interest earned under the interest section (form 1099-INT).  Enter it there as though you had received the form and then the interview will prompt you if there was no form or the income was foreign.  The sales of stocks is entered in the investment section (form 1099-B).  Same advice applies.

You are entitled to a foreign tax credit if you paid any taxes to Canada on the income on your US return.

Activity inside your pension plan is not taxable.

[ginazhong]

Thank you, Robert. That's very clear. So do you know if I still need to submit form 3520 or 8621 in addition to IRS? to report that I have RRSP and TFSA account and have stocks and Mutual Funds in it.

[GBO91]

Thank you for the quick response - I moved to USA and am a resident for 2021 -- but have not sold, bought, or received dividends/distributions from the stocks within my Canadian TFSA or RRSP -- I believe I still need to declare my holdings on the FBAR FinCEN 114 form as well as 8938; but I am unsure if I need to submit an 8891 or 8621 since I have not had income from selling or receiving distributions, is this correct?

Much appreciated, GBO

[bogao3037]

Hi Gina I am in the similar situation. Did you find out if the 3520 is needed for TFSA and RRSP?

[DianeW777]

It depends.  Foreign retirement, pension, and savings accounts (including Canadian TFSAs and RCAs) are within the category of foreign trusts that are subject to Form 3520/Form 3520-A filing and therefore are subject to penalties for failure to timely file.

You may need to complete Form 3520  if you have the following:

1. You are the responsible party for reporting a reportable event that occurred during the current tax year, or you are a U.S. person who transferred property (including cash) to a related foreign trust (or a person related to the trust) in exchange for an obligation or you hold a qualified obligation from that trust that is currently outstanding. 
2. You are a U.S. person who, during the current tax year, is treated as the owner of any part of the assets of a foreign trust under the rules of sections 671 through 679
3. Your aggregate gifts were more than $100,000
   • Instructions for Form 3520
   • IRS Notice 2003-75 (Rules to report RRSPs)

There are two main categories of trusts: 

1.  Grantor trusts: The grantor is taxed on the income
2.  Non-grantor trusts: The initial grantor or settler is not considered the owner of the trust and therefore is not subject to US tax on the income.

@bogao3037