I am a Canadian who has lived in the US for 20 years, and now have dual citizenship. I have RRSP's in Canada and did all the appropriate 8891's, FBAR etc. along the way to declare them. Conventional wisdom says to save tax returns for 7 years. Can I safely shred my old U.S. tax returns, or because of the RRSP's is it possible I might need to go back to prove that I correctly declared my RRSP's at a later date (such as when I try to start withdrawing from my RRSP's )?
Thanks!
Saving old tax returns
Moderator: Mark T Serbinski CA CPA
The whole point of keeping anything related to RRSP for US tax purposes is to determine the portion that is taxable in US when you withdraw.
So, What you need for RRSPs is something to document the value of your RRSP when you became a US taxpayer, and whatever non-deductible contributions you've made since then.
The arrival basis would be on your original Rev Proc 89-45 statement (it doesn't appear on any 8891), and contributions would be on your 89-45's and your 8891's, but not specifically what was deductible and what was not.
So keeping old returns, and old FBARs doesn't really help you. Reporting isn't the issue, determining taxability is what you are concerned about.
But I would be keeping my original 89-45's and a spreadsheet of my RRSP contributions which could not be claimed on my 1040 over the years, (and withdrawls of course, taxable and non-taxable)separate from my yearly returns, until your RRSPs are depleted.
it's easier for US residnts who no longer contrubute to RRSPs, since they only need original book value on arrival, for US taxpayers still contributing to RRSPs its more of a paperwork burden.
Other than that the 7 year rule is best to follow for 1040 FBAR 3520, etc. Time is passed to come back on your before that point.
So, What you need for RRSPs is something to document the value of your RRSP when you became a US taxpayer, and whatever non-deductible contributions you've made since then.
The arrival basis would be on your original Rev Proc 89-45 statement (it doesn't appear on any 8891), and contributions would be on your 89-45's and your 8891's, but not specifically what was deductible and what was not.
So keeping old returns, and old FBARs doesn't really help you. Reporting isn't the issue, determining taxability is what you are concerned about.
But I would be keeping my original 89-45's and a spreadsheet of my RRSP contributions which could not be claimed on my 1040 over the years, (and withdrawls of course, taxable and non-taxable)separate from my yearly returns, until your RRSPs are depleted.
it's easier for US residnts who no longer contrubute to RRSPs, since they only need original book value on arrival, for US taxpayers still contributing to RRSPs its more of a paperwork burden.
Other than that the 7 year rule is best to follow for 1040 FBAR 3520, etc. Time is passed to come back on your before that point.
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