Question on 8891 Line 16

Nishant · Post by **Nishant** » Sat Jan 09, 2010 9:16 pm

Paper copy of 8891 is complicated. Turbo tax makes it somewhat easy.

Questions on line 16 are

1)Line 16(a) -Should line 16( a) RRSP amount correspond to the day when you became non resident of Canada or should it correspond to amount as of 31st Dec 09?
It may be difficult to get accurate value for the specific day, is estimated value OK?

2) Line 16(b) -As long as election is made to defer taxes and no withdrawl during the year from RRSP, will not 16(b) be always zero?

nelsona · Post by **nelsona** » Sat Jan 09, 2010 9:55 pm

There is no line 16 on Form 8891.

Nishant · Post by **Nishant** » Sat Jan 09, 2010 10:24 pm

My error. Please read as Line 7(a) and Line 7(b) on 8891 in my original post.

nelsona · Post by **nelsona** » Sat Jan 09, 2010 11:04 pm

Line 7 deals with withdrawls made form your RRSP. 7a is the value in USD of that withdrawal. 7b is the taxable portion of that withdrawal, which I have described in length how to calculate, based on the value of your RRSP when one arrives in US.

hard or not, you will need to determine that value and keep it in your records for future use in determining 7b, but it doen't appear anywhere on 8891.

Nishant · Post by **Nishant** » Sun Jan 10, 2010 12:29 am

Nelsona- Thanks.

Request clarification.

The exchange rate would be that of the day of withdrawl from RRSP in future and not the rate of the day when one becomes non-resident of Canada.

nelsona · Post by **nelsona** » Sun Jan 10, 2010 12:40 am

The rate for the withdrawal would be the rate on that date. The book value of your RRSP for taxable calcualtion is basedon rate when youy arrived.