Serbinski Accounting Firms

[quote="excan007"]Thank you nelsona. It all makes sense . I wish IRS provided some example for the 1 million or so Canadians living here.

Thank you "Nelsona" for all the information so far

I read the long and exhaustive instruction to forms 1116 for year 2010 and nowhere it says that pensions are ...

Thank you nelsona. It all makes sense . I wish IRS provided some example for the 1 million or so Canadians living here.

One more thing The first tax return in US was in 2003 with the election. I wil just use the average USCDN exchange for 2003 for the RRSP cost basis -I would think this should be ...

Just trying to wrap it up.
So with 50k gross distribution of which 20k is taxable in US because of the treaty/election to defer gain the
gross foreign income on line 1b of form 1116 should be 20k

Is this correct ? Is there an IRS example or reference for this?

For the conversion rate - does one ...

OK. When I enter the 50k ditribution from RRSP 20k taxable
(Growth since entering US)
I get a jump of 5600$ in TAX this is the 28 % AMT rate
on the 20k.


Then in foreign tax credit - "step by step" it asks for the gross income
from foreign source I enter 50k for the entire distribution

then I ...

Dear Nelsona,

Indeed it seems that almost entire credit is used. I use now "general income" and you are right it makes no difference. One thing I don't quite understand is that I thought it will be neutral on my taxes. Ie Tax on gain in RRSP will be offset by the foreign tax credit.

But it seems ...

[quote="nelsona"]Yes, general income, by elimination of the others. RRSP is defined as pension.

You are probaby not doing the 1116's correctly.

It is not passive income.[/quote]


Do you have a solid reference to the IRS position that RRSP distribution is not passive income ?? It could be ...

[quote="nelsona"]Lump sum distribution is for specifically defined transactions.

Besides, it doesn't help that it would be in one category or another.[/quote]

Thanks. But. Is there a precedence or IRS guidance which category to use. Actually there is passive income, general income or, lump sum.
It ...

Dear nelsona et al,

Do you have a good reference on why income resulting from collapsing the RRSP would be considered "general income" rather then "lump sum distribution" in the US tax return??

I have seen conflicting messages.

It does affect the foreign credit calculation