RRSP or IRA for U.S. citizen temporarily working in Canada

[nelsona]

Save your money, and take it with you when you leave.

[Terri717]

1) Would it be of benefit for me to close the TFSA, requiring me to only file the 3520 for the 2010 year?

2) I've been reading through the forums and a lot of people speak to a Roth IRA and having to report gains to CRA. Do I have to report anything with my traditional IRA?

3) Within my traditional IRA one of my funds paid out a dividend (a whopping 12 dollars!) to my cash account. Does this have to be reported?

4) From what I read, stocks can be transferred from Canada to the US. I'm thinking of using that as an alternative investment route while living in Canada. What are the tax implications if I go that route?

5) If my husband and I decided to stay in Canada for another 5 years and purchase a condo in Toronto, if we sell that before we leave, what would the tax implications be since I'm a US Citizen (he's a Canadian citizen)? The other option is to rent it out, but I read that the rental tax is 25% to CRA.

Your answers have been very helpful!

[nelsona]

1) I would in your position
2) one only hasd to report Roth internal income if they contribute to it as a Cdn resident. IRA internal income is not reportable, and no special forms (like IRS 8891) are required for CRA.
3) No. See above.
4) Any staocks yoy hold while in canada are deemed by CRA to be sold the day you left canada, regardless of what you do with them. So you will pay cap gains in canada on the Cdn gains, and US tax on the entire gains. The transfer doe s not in itself trigger US tax, only a sale does. However you can opt to have the deemed sale take place for US tax purpouses as well, in order to match up the US and Cdn taxes for that year.
5) You would still get $250K tax free because it was your home. 100% tax free in canada. The rental tax would be 25% of your NET rent. Of course if youheld onto it for more than a few years after you left, you would lose some or all of the US tax write-off.

[AMRivlin]

I am in this same situation and I am very confused on what I can and can't do. Or what I should be doing.

Some background;
US Citizen living and working legally in Vancouver, BC for 12 months now. (Work Permit)
Annual income $62,000

I have in USA from previous years:
401k $17,000 (Pretax)
Roth IRA $45,000 (Posttax, I contribute maximum $5k annually)

I have in Canada:
TFSA $3000 with contributions to meet the $15,000 possible balance by 2012.
Savings Account $15,000 @ .25%

I am considering a RSP.
I am considering a 3 year Utility GIC.
I do not yet have an assessment from CRA, so I do not yet know what my contribution could be, but I was considering putting $5k (Well under 18$ max) into a RSP Mutual Fund.
What should I be aware of?

A colleague told me I can have RSP and TFSA, but they can't be in Mutual Funds? That sounds like bunk, and if that is the case what do I do about the one I already opened.

[nelsona]

You cannot put anything in RRSP for 2010, since your limit is determined from previous years' income. You can put $2000 and not take deduction until 2011 return.

A TFSA is of little value to you, since it is taxable in US all the time.

Do not fund Roth while in canada.