RRSP account withdraw

This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.

Moderator: Mark T Serbinski CA CPA

Post Reply
mygalina58
Posts: 2
Joined: Mon Nov 01, 2021 11:13 am

RRSP account withdraw

Post by mygalina58 »

Hi
I move to USA on TN visa in 2005 by NAFTA. By this time I had RRSP account (5k ) in Canadian bank. The account still open since I'm frequently going to Canada to visit my children. Now I'm married to US citizen (2012), holding GC and applying for US citizenship now. I'm getting 65 in 2022 and planning to retired. What it could be the best strategy for the money in RRSP account( it's 7K now)? Since 2005 I fill up only US TAX forms and never reported this money.
ND
Posts: 291
Joined: Thu Feb 21, 2013 5:28 pm

Re: RRSP account withdraw

Post by ND »

likely to convert to rrif and withdraw at much lower rate than 25%
mygalina58
Posts: 2
Joined: Mon Nov 01, 2021 11:13 am

Re: RRSP account withdraw

Post by mygalina58 »

I red that RRIF has the same withholding tax rates as an RRSP on withdrawals. For non-residents, withholding rates are 25% for lump-sums, and 15% for periodic pension payments. Is it not true?
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: RRSP account withdraw

Post by nelsona »

No. RRSPs cannot have the lower rate applied, regardless of the nature of the withdrawals. This changed in the 90's.

If you convert to a RRIF, and you withdraw only 10% or less a year, you will get the 15% withholding. The firm holding your RRSP/RRIF must be advised that you live in US (which you would have told them in 2005)

For US tax, you are taxable on the growth since you moved to US.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
Post Reply