Questions about Form 8891

Rabadash · Post by **Rabadash** » Thu Feb 17, 2011 11:49 am

Since moving to the U.S. from Canada in 1994, I've annually claimed a Treaty election for each of 3 RRSP accounts under a now-obsolete article in 89-45. Now that someone has pointed out my error, I want to do the right thing, but have a few questions with respect to form 8891. (While it is simple in its format, it is not clear for users)

1. I am inclined, because of my honest error (and because the IRS has not objected to the paperwork I've submitted for 16 years) to simply check "yes" on 6a and "1994" on 6b. But since the specific article I named in my annual elections was different, ie. XXIX (5), I'm no long sure what I should do with section 6 of the form.

2. Filling out 10 a-e with internal income would increase my current year 1040 income. isn't that contrary to what an annual election is meant to defer?

3. As I have not yet received any distributions from my plans, how would you recommend I fill out sections 5 through 10 of the form?

I appreciate this forum and the good service you are providing.

nelsona · Post by **nelsona** » Thu Feb 17, 2011 2:50 pm

Did you read the instructions?

The instructions for line 6 tell you what to do on line 6 if you previously filed under 89-45.

Since you are beneficary and are electing to defer, the instructions are also clear as to what lines you ned to report: You stop at line 8.

You have continuously deferred taxation, thus you are not going to be taxed now either, until you take a distribution out of your RRSP.