T5008 for mutual fund sale

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T5008 for mutual fund sale

Post by linkspan »

I am a Canadian citizen living in the US. I left Canada in 2019, but kept some mutual fund shares in a non-registered account when I left. I filed an emigrant return for 2019 and included my deemed disposition. I also informed my bank that I was now a Canadian non-resident. I ended up selling my mutual funds in 2020, before any distributions were made from the fund. So I recevied no dividend/interest income during 2020; my only Canadian-source income was the capital gain on the sale of the mutual fund shares, which were reported on a T5008. This is the only Canadian tax form I received for 2020.

My question is - do I need to file a Canadian tax return & pay taxes on these gains? I am aware I need to do so with the IRS, but I believe that I do not need to do that with the CRA since this doesn't fall under Part I or Part XIII. Is my understanding correct?
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Re: T5008 for mutual fund sale

Post by nelsona »

That is correct. Your deemed disposition was your final Cdn tax responsibility on those investments

In US, you need only report the gain (or loss) above the value reported on your departure tax return rather than the original basis, but only if you follow the rules set out in IRS Rev Proc 2010-19.
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