Changing RRSP Investment Direction - Living in NY

[CADUSD123]

Hi friends

Canadian living in the State of NY here. Wanted to confirm my understanding here. Appreciate any help - especially for points 1 and 2.

1. NY state allows for RRSPs to grow tax deferred - essentially "following" the IRS US/CAN tax treaty

2. I can change my investment mix as much as want within the RRSP (i.e. buy and sell investments) with no tax issues in either the US or Canada as long as I don't withdrawal or contribute

3. I don't have to worry about the US's PFIC (passive foreign investment company - which essentially are most Canadian ETFs and Funds on Canadian exchanges) rules since RRSPs are exempt from that.

4. My RRSP is automatically considered tax deferred as long as I report FBAR - no special election needed ever since the IRS simplified the rules almost 10 years ago.

[nelsona]

1. Correct
2. That is solely up to the RRSP management. Most forbid changes. You may need to transfer to another firm. But as long as the funds stay in an RRSP or RRIF there is not tax consequences until withdrawal.

3. Correct

4. The RRSP is tax-deferred regardless of whether you file FBAR. FBAR needs to be filed for all your accounts in any event. The other reporting is no longer required.
make sure you have locked down the book value of your RRSP when you became a US taxpayer. That portion can be withdrawn tax-free later.

[CADUSD123]

Thanks!

For #2 - what do you mean by "RRSP management" - do you mean the wealth manager or the brokerage firm that holds the RRSP? If they allow it?

[CADUSD123]

Thanks!

For #2 - what do you mean by "RRSP management" - do you mean the wealth manager or the brokerage firm that holds the RRSP? If they allow it?

[nelsona]

Yes. Each firm sets their own policy on whether/how to deal with clients who move to US, often depending on which state of residence.