Moving to the US on TN, what to do with TFSA

jimmydalock · Post by **jimmydalock** » Wed Jan 05, 2011 4:13 pm

My spouse and I are moving to the US this year (on TN/TD respectively). We both have TFSAs holding securities (blue chip stocks and MFs). I know that we obviously cannot buy/sell while residents of the US (but plan to eventually move back to Canada). TFSA are taxable in the US but are they taxable on an annual basis? or on capital gains when selling? What implications does this have? Should we be selling these securities before moving?

nelsona · Post by **nelsona** » Wed Jan 05, 2011 7:04 pm

any income generated within the TFSA is taxable year by year.

Worse, though, is that a TFSA is a trust subject to IRS trust reporting form 3520.

I would be closing the TFSA and only reopening it when I return to canada

jimmydalock · Post by **jimmydalock** » Wed Jan 05, 2011 7:38 pm

When you mean closing, you mean withdrawing to a 0 balance or physically closing an account?

nelsona · Post by **nelsona** » Wed Jan 05, 2011 7:48 pm

Physically closing the account. This doesn't impact your future ability to replenish a new TFSA.