Timing of opening brokerage accounts when moving US -> Can

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filkry
Posts: 13
Joined: Tue Feb 24, 2015 5:27 pm

Timing of opening brokerage accounts when moving US -> Can

Post by filkry »

I'm a Canadian citizen who has been living in the US for 7 years, moving back to Canada next month.

My wife and I have significant holding in a TD Ameritrade taxable account, and would like to move them with an in-kind transfer to TD Direct Investing or Interactive Brokers.

However, I'm supposed to close the Ameritrade account when I'm no longer a US resident, and not supposed to open a Canadian account until I'm resident in Canada. So I'm really not sure what the correct timing is to open the Canadian account and initiate the transfer - before, or after I move.

Anyone have experience with this kind of thing?
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Timing of opening brokerage accounts when moving US -> Can

Post by nelsona »

You can hold the investments in Ameritrade until you move, and then, once you opne the CDn account, make the transfer. Not complicated at all. You just can't trade while in Canada. SElling (or transferring) is fine.

Remember that US mutauls can't be transferred; you will need to sell those.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
filkry
Posts: 13
Joined: Tue Feb 24, 2015 5:27 pm

Re: Timing of opening brokerage accounts when moving US -> Can

Post by filkry »

Thank you!
filkry
Posts: 13
Joined: Tue Feb 24, 2015 5:27 pm

Re: Timing of opening brokerage accounts when moving US -> Can

Post by filkry »

I have a followup question hopefully someone can help with.

My understanding is that since I'm not a US citizen or permanent resident, no US exit tax applies, and the value/cost basis of my securities is whatever value they are on the day I moved.

However, the day the actual transfer occurs will not be the day I move, so the cost basis in my Canadian brokerage will be wrong, presumably leading all their tax documentation to be erroneous.

I do know one brokerage, Interactive Brokers, will allow me to edit the cost basis to be correct, but for other reasons I'd prefer to go with TD Direct Investing, who say they cannot make this change (the value would be based on the date of transfer).

Is there any way I can fix this discrepancy on the tax filing side? Or am I misunderstanding something fundamental here?
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Timing of opening brokerage accounts when moving US -> Can

Post by nelsona »

btw, since you are not taxable in US after your move (or at least, as of jan 1 of the year after you move), you would not owe ANY tax on investments sold after you are no longer taxable in US.

IN any event, YOU determine the cost basis for income tax of any investment you sell, not the broker. Simply keep track of the FMV of your arrival date to Canada, and use that in future when you sell.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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