How to claim Group RSP contribution on 1040

jhuang1213 · Post by **jhuang1213** » Tue Mar 19, 2013 3:00 am

I have contributed to our company's group RSP (US GC holder). I am wondering How to claim my contribution on 1040 to take advantage of new benefit of Fifth Protocol of US-Canada tax treaty?

Thanks
J

nelsona · Post by **nelsona** » Tue Mar 19, 2013 5:21 am

Simply reduce your T4 wages by your group contribution and report this amount on wage line of 1040.

ND · Post by ND » Tue Mar 19, 2013 3:04 pm

Also add Form 8833 citing Article XVIII(15) with an explanation like: TAXPAYER CONTRIBUTED US$XYZ TO A QRP, A CANADIAN RRSP AND
CLAIMS SUCH DEDUCTION PER ARTICLE XVIII(15) OF THE US-CANADA TAX
TREATY AS AMENDED BY THE TREATY'S FIFTH PROTOCOL.

nelsona · Post by **nelsona** » Tue Mar 19, 2013 3:48 pm

Good point. If the funds are in an RRSP account that the taxpayer controls (ie. can make trades into various investemts etc), he would also file a form 8891 fore this account, and would include it in FBAR.

nelsona · Post by **nelsona** » Tue Mar 19, 2013 3:58 pm

Just aone point. On the 8833 I would specify an "Employer-sponsored" RRSP, as this is the key requirement of that clause.

Unfortunately, such a declared and deducted contribution cannot be considered non-taxable investment in the RRSP, when in future he will take withdrawals from it.

It is sometimes wise, sic=nce one should be exempting the entire wage using form 2555 if one can, to forego making the deduction, in favour of future non-taxability of that portion of the RRSP.

and, finally, the clause that would be used is article 13, not 15.

nelsona · Post by **nelsona** » Tue Mar 19, 2013 4:03 pm

I guess, since our poster is not a USC, the paragraph is 10: Article XVIII(10).

nelsona · Post by **nelsona** » Tue Mar 19, 2013 4:06 pm

jhuang,

I have some confusion here: you state elsewhere that you are a GC commuter, working in US. How are you contributing to a CDN RSP?

If this is wages from before you began living in US, you should exclude the entire wage, not report it and deduct RRSP. Or you should be reporting entire wage and using form 1116 to credit the Cdn tax.

Sounds like something is not quite right.

jhuang1213 · Post by **jhuang1213** » Tue Mar 19, 2013 10:26 pm

Nesonla,
Our company has offices in US and Canada. My benefit is from Canadian office.

nelsona · Post by **nelsona** » Wed Mar 20, 2013 1:48 pm

Right, so the treaty provison is a special one for commuters, article XVIII(8), which lasts for 5 years.