home buyer plan recognized by IRS

tdiddy · Post by **tdiddy** » Sun Nov 10, 2013 6:20 pm

Hi

I have another quick question for you guys regarding dual US-Canadian citizens. My wife and I are looking to buy a house, I'm wondering if she can withdraw from her Canadian RRSP under the Home Buyer Plan ($25,000) and not pay tax on this income in the USA? Does the IRS recognize the Home Buyer plan like the CRA does, or do they have a similar plan?

Any tips?

Francis · Post by **Francis** » Tue Nov 12, 2013 1:07 pm

No the IRS will treat the withdrawal and drawings from RRSP and tax you.

I don't know about anything equivalent.

nelsona · Post by **nelsona** » Wed Nov 13, 2013 9:15 am

Franci os not correct. An HBP withdrawl is NOT considered income for IRS purposes. However, it does trigger payment of US tax on previously accrued income, ie RRSP income that was previously sheltered using 8891.

VaniB · Post by **VaniB** » Sat May 17, 2014 8:18 am

Does that mean that when the HBP was initially taken, the entire amount is taxable for IRS purposes even though it is not shown in the canadian return?
I've had a similar situation for a client too and would like to know what is the right treatment.

Kind regards

nelsona · Post by **nelsona** » Sat May 17, 2014 1:15 pm

Re-read what was written.