Sorry to trouble but just wanted to confirm the following: I am a Cdn citizen/US resident who elected to defer RRSP. In 2009, I made a partial RRSP $7000 withdrawal and am currently filing form 8891.
On form 8891 section 7a I placed the entire 7000 amount and this figure should also be on 16a on my 1040. 7b is the tricky part as this forum can attest: Dec 06 (first US filing) book value was $45k USD. Dec 09 market value (USD) was $44k (before 7k withdrawal).
Does this mean the taxable portion is zero due to capital loss? In addition, can I claim foreign tax credit on 1116 for the 25% withheld by Canada despite the capital loss?
Any guidance would be appreciated.
RRSP Distribution Form 8891
Moderator: Mark T Serbinski CA CPA
From what you state there is no taxable portion to your withdrawal. However, since that means the 25% tax can only be used as a deduction on schedule A, since you have no Cdn income to write off against.
If you had some distributions in the past 3 years, you could include these as teh taxable part and get something for your 25% as a credit, and save the rest for future years.
I trust your method of calcualting arrival book value is accurate: cost basis (not market value) of all your RRSP at the time you became taxable in US.
If you had some distributions in the past 3 years, you could include these as teh taxable part and get something for your 25% as a credit, and save the rest for future years.
I trust your method of calcualting arrival book value is accurate: cost basis (not market value) of all your RRSP at the time you became taxable in US.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best