RRSP / IRA + 401(k)

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oakweather
Posts: 27
Joined: Thu Oct 15, 2020 1:00 pm

RRSP / IRA + 401(k)

Post by oakweather »

If one has earned income on both sides of the border (T4 + W2), as a non-Canadian resident and US citizen, what is the interaction between RRSP and IRA/401(k)?

My understanding is that non-Canadian residents are able to accrue RRSP contribution room based on T4 income.

If such an individual contributes to RRSP in a given year, does this affect the contribution limits in IRA (Roth/traditional) or 401(k) (Roth/traditional)?

On the flip side, if such an individual contributes to IRA (Roth/traditional) or 401(k) (Roth/traditional), does this affect the RRSP contribution room?

Thank you!
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: RRSP / IRA + 401(k)

Post by nelsona »

For IRS, Your US contributions limits are unaffected by personal RRSP contributions, since these personal contributions are not deductible anyways. The limit is the same regardless of your US wage level (s long as you reach the minimum.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: RRSP / IRA + 401(k)

Post by nelsona »

Since such 401k contribution would only decrease the deductibility of RRSP contributions in Canada in that particular year, and since you are not likly contributing to an RRSP while in US, your RRSP contribution room will grow to theextent you report the Cdn income earned.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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