1040NR Reporting Dividend and Interest Income

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elgoog
Posts: 12
Joined: Thu Sep 19, 2019 9:40 pm

1040NR Reporting Dividend and Interest Income

Post by elgoog »

Hi,

Canadian resident with TN-1 worked in California in 2020.

I plan on filing a 1040NR (and 540NR) for 2020 and had some dividend income on some short term (< 1 year) investments (~$80) and interest income (~$20) from USA bank accounts while I was in the USA. Since the brokerage didn't have a W8-BEN, they didn't withhold any tax. I have since closed my account.

1. Will I have to report this on 1040NR under Schedule NEC? Do I pay the 15% tax on the dividend as per the USA-Canada tax treaty? What treaty article should I use?
2. Do I have to do the same for the interest income?
3. How would I get a credit for this on my Canadian return?

Thank you.
nelsona
Posts: 16793
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: 1040NR Reporting Dividend and Interest Income

Post by nelsona »

Non-residents are not required to report bank interest (even earned in US) on their 1040NR. So nothing to claim as a foreign tax credit
As you say, include the dividend on NEC table of 1040NR. You claim the 15% as a foreign tax credit on your cdn return. Article X.2(b)
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D
elgoog
Posts: 12
Joined: Thu Sep 19, 2019 9:40 pm

Re: 1040NR Reporting Dividend and Interest Income

Post by elgoog »

Thank you for the reply. So it's just the same federal foreign tax credit form https://www.canada.ca/en/revenue-agency ... t2209.html that I should use? Or is there a separate one for dividends?
nelsona
Posts: 16793
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: 1040NR Reporting Dividend and Interest Income

Post by nelsona »

Your software will handle this. It all goes one one line of the tax form (for fed, and for prov). It will generate the needed form(s)
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D
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