re-sourcing income

[jayroh]

Confused on re-sourcing income

1. Income from US dividends. Does the US claim such income first? A dual national would submit a W9 in Canada and then no US tax would be deducted. A Can resident only (not dual national) would have 15% US tax deducted and then get a credit on the Canadian return for the tax deducted. Therefore should a dual national pay the US for US dividends or re-source all dividends to Canada such that the US gets no tax on these funds and Canada gets it all?
2. I have inherited an IRA. 15% tax is deducted from my payment. Do I re-source all this income to Canada because I am a dual national Canadian resident?
3. I had to cash an annuity inherited from my US mother as this was the 5th year from her death. Again 15% was withheld. Do I re-source this payment so that it is fully taxed in Canada and no tax owing the US?
4. Bank interest from the US shows no tax withheld on the 1099 (bank knows I live in Canada). Therefore is this interest re-sourced to Canada via 1116 such that the US gets no tax from this income?

Thanks for the input.

[nelsona]

1. No, US gets their tax on their tax return, ob which you report the dividens. Only if the effective tax rate on your US tax return would you re-source some to get credt. Your Cdn return gets the credit, but only for the US tax you actually end up paying, which should be nearly zero.
2. NO. You don't seem to understand re-sourcing. It is only done when canada does not credit you with your US tax, either by limit or by treaty.

Do I need to go on?. Preapre your US return, reporting all world income, and do teh same in canada. you get credit on your CDn return for US tax, if any on your US income, and you get credit on your US return, for CDn tax on your US income. No need for re-sourcing at all.