RRSP and form 8891

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nanic
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RRSP and form 8891

Post by nanic »

From the Issac Brock Society website:

Phil Hodgen has some good news for the Canadians in the audience:

Up to now the way to fix an unreported RRSP problem was by incurring brain damage, spending lots of money, or suffering through terminal uncertainty and fear. Or all of the above … Guess what. Things have changed for the better. I’m serious. We confirmed today in a phone call with Chief Counsel’s office that amended tax returns will be allowed with Form 8891 attached.

In other words, a seemingly pointless waste of paper the IRS issued to one taxpayer early this year may have unforeseen historical significance: it is quite possibly the last “late RRSP electionâ€￾ Private Letter Ruling that will ever be made.
nelsona
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Post by nelsona »

That is good news. Of course, I ALWAYS suggested bypassing PLR's up until Jan 2013, when IRS made it mandatory, but IRS has quickly come to their senses.

The big firms had been forcing thr clients the unnecessary expense of PLR for years,. I'm gald to see one cpa fight to close wheat was a pretty lucrative exercise for themselves.

Good ethics from Phil Hogden! Wish the other had followed suit years ago.
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testone
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Post by testone »

I am not familiar with any official pronouncement in January 2013 that states that PLRs ARE required for late 8891s. Similarly, I am not aware of any official announcement by the IRS now that PLRs are NOT required for late 8891s. It somehow doesn't seem official when you hear about it on a tax bulletin board that says it was posted on a blog that says some advisor spoke with someone at the IRS who said you don't need to get a PLR anymore. As you said in your May 30, 2013 post: "IRS are always giving wrong info." http://forums.serbinski.com/viewtopic.php?t=7635

Hopefully the Chief Cousel's office would give accurate information, but without any official pronouncement, who knows?
nelsona
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Post by nelsona »

The "announcement" that back-filing 8891 was no longer permitted for making an election was made when the new form was relaeased in december 2012. The new instructions clearly stated this for the first time.

So, no misinformation here.
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DWL
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Post by DWL »

I just recently found this forum and an amazed at the wealth of information available here.

I need to file Form 8891 it is my understanding that you are to submit an amended return. Do you have to fill out a form 1040X or just submit the original 1040 with the 8891.

Thanks
nelsona
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Post by nelsona »

you never submit the original 1040 along with a 1040-x, regardless of the reason.

You only submit what is being changed or added.
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skoper
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Post by skoper »

To clarify, 1040's from previous years missing 8891's need simply to be amended and resent with the 8891 now attached, as simple as that?
skoper
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Post by skoper »

[quote="skoper"]To clarify, 1040's from previous years missing 8891's need simply to be amended and resent with the 8891 now attached, as simple as that?[/quote]

To be clear, I made an election to defer when the 8891 was last filed for 2009 tax year.
nelsona
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Post by nelsona »

NO. Reread what I wrote: you send a 1040-X with only the 8891 attached. You do not send your 1040.
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milehicanuck
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Post by milehicanuck »

If an 8891 has never been filed with the 1040 how many years back should I go to send an 8891 with a 1040-X?

Also any thoughts on FBARs?
nelsona
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Post by nelsona »

You need to go at least 3 if not six years. This is an OVDI issue. Search for "streamlined" for guidance.
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rohitkn@gmail.com
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Post by rohitkn@gmail.com »

@nelsona:
"That is good news. Of course, I ALWAYS suggested bypassing PLR's up until Jan 2013, when IRS made it mandatory, but IRS has quickly come to their senses. "

So is PLR required for late election or not?

I just saw an accountant who charges a *lot* and says this is all he does - Cross Border taxes. He said he's been backfiling 8891s with late election + reasonable cause letters and throughout the past 2 years he hasn't had a problem or should I say his clients haven't had any, with the IRS... yet?
nelsona
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Post by nelsona »

That is what is meant by "IRS permission". Only if you qualify for steamlined processing (meaning at a minimum that you live in Canada) can you avoid this.
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