Serbinski Accounting Firms

Nope.

Just to clarify what you accountant said, or should have said: You DO have to report and pay the 401(K) withdrawl in US, but you ALSO have to report it in canada. You also have the 10% early withdrawl penalty in US. Don't forget this. Other than the tax credit for the tax (but not the penalty) you p...

When you file a 1040, you must report and pay tax on your WORLDWIDE income for the entire year. All of it. You can exclude Cdn wages (and only those earned before the move, by the way) with 2555. All other income must be reported, with tax due. you could have simply chosen to repoert the wages and u...

Anything YOU contribute to your 401(K) will be taxable in canada, by adding it to the wage figure on your W-2. The firm's contribution will not be reported. You will be subject to PA adjustment. None of it is reported in US (in fact it will not even show up on your W-2 wage box) When you withdraw fr...

Departure return (in fact, all non-resident returns) are usually processed in mid-summer. They are last on the totem pole.

2555 is for earned income: wages, basically, not interst.

Credit for foreign taxes paid on non-US income goes on Form 1116.

Even for wages, you had the opton of 2555 or 1116.

just to make small correction, it's illegal from USCIS point of view.

It's only illegal from IRS pov if she doesn't report the income.

I aggree -- kind of.


Wait to see what the NR looks like. if it has the wrong code, it'll be TDW's problem.

But if it is coded correctly, you will have to pay at some point.

Yikes.

25%

25%

25%.

So they want the tax first, and then you appeal?

I would want to appeal first, methinks.

Had you added a note back in 2003 you would have been fine... now they will 'investigate'

The rate is 15%.

Not sure what you meant about the the IRA. That doesn't change its tax treatment in either country.

.. and just for my own peace of mind. Did you or did you not report these contributions as earning on your Cdn tax return, during 1996-2001. If you did, you might want to include copies of your W-2 and T1s to show that you did just that. Reviewing your posts, you seem to have been very careful never...

This is good news. To assist you in making your claim, remember 2 things; Your 401(k) is recognized as an Employer Benefit Plan (EBP). Very important to use this term. and that ITA (6)(1)(g)(ii) allows exclusion of income that is considered employee contribution. Look at IT-502 para. 19, and, if you...

Just to clarify: If, however, you lived in Canada all that while you were working, You should have reported the income (in the year you withdrew it) with a note indicating that it was not taxable, due to it being the return of your previously taxed contribution. You would have detailed records of YO...

In the year of departure, you report ALL world income earned before departure, and then ONLY CDn income which was not subject to flat NR tax after departure. This highlights the importance of telling your broker/banker/etc that you are non-resident.If you have not done so, this weakens your claim to...