Hi,
I need to figure out the US tax implications of receiving a "Supplementary Death Benefit" from the Canadian Government. As a Canadian citizen living with permanent residence in the US I am getting confused. I can discern that Canada does not tax this benefit according to their website, but I am unsure if the US also classifies this income as tax free. Does anyone have any experience with how the IRS treats this income?
https://www.canada.ca/en/treasury-board ... eath-deces
Thanks!
PLEASE HELP with Supplementary Death Benefit
Moderator: Mark T Serbinski CA CPA
Re: PLEASE HELP with Supplementary Death Benefit
It is tax-free, since it is treated like a pension.
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Re: PLEASE HELP with Supplementary Death Benefit
Thanks for the reply. I am confused as you mentioned it is treated as a pension. Pensions are taxable income are they not?
Re: PLEASE HELP with Supplementary Death Benefit
By treaty, only to the extent that they are taxable in the country of origin. Since Canada does not tax it, nor does US.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing