8891 Form

cantousa · Post by **cantousa** » Fri Dec 14, 2007 11:59 pm

I have filed 8891 with my 1040 for the last two years. But recently I realized I have a second RRSP account which I completely forgot about. I plan on including it on the 2008 return and also file 1040X for 2005 and 2006.
If I had filed 8891 for this second RRSP account along with my 1040 in 2005 itself, I would have checked "No" for 6(a) and also cecked 6(c). In 2006 it would have been "Yes" for 6(a) and "2005" in 6(b).
Do I do the same thing on the 8891 forms I plan to file with a 1040X?

Thanks.

--UC

nelsona · Post by **nelsona** » Sat Dec 15, 2007 7:36 am

Yes, because you will send your 1040-X before you send in your 2007 return. Why would you wait? You should never include anything extraneous with your yearly return.

nelsona · Post by **nelsona** » Sat Dec 15, 2007 7:38 am

but even if you were to send it in later, I would be making the election back in the first year you intend to use the election.

cantousa · Post by **cantousa** » Sat Dec 15, 2007 8:56 am

Nelson,

I have seen many posts on this site where people were able to successfully back file 8891's. However it seems they were not aware of 8891 and did not file for many years and once they found about it, they went ahead and back filed 8891's. In my case, I was aware, but I did not realize I had a second RRSP account. There a difference.
I am a bit worried. Do you know of cases where people back filed 8891 and IRS did not accept the amended return and asked the tax payer to pay hefty penalties for not disclosing it in a timely manner? Thanks.

nelsona · Post by **nelsona** » Sat Dec 15, 2007 1:32 pm

I do not know of any cases. File now without worry.

cantousa · Post by **cantousa** » Tue Dec 18, 2007 2:09 pm

Nelson,

I am looking at 1040X to back file 8891 forms for years 2005 and 2006. I have filled out the 8891 forms. With regards to 1040X - besides writing names, SSN, address etc, the only other thing to do is to write "I am amending my 1040 to add Form 8891, with no changes to income, credits, or deductions" and sign. Correct??
Does the explanantion have to be anything more than this?
What about the rest of the form - Lines 1 to 33?
Can I include 1040X for both 2005 and 2006 in the same envelope?
Thanks.

nelsona · Post by **nelsona** » Tue Dec 18, 2007 7:33 pm

Since you've already read my instructions on 8891 I won't belabour the answer. They can be sent together.

cantousa · Post by **cantousa** » Tue Dec 18, 2007 7:37 pm

Nelsona,

Thanks.

Please answer the following. If you are tired of me asking too many questions, just provide "yes" or "no" answers.

1. With regards to 1040X - besides writing names, SSN, address etc, the only other thing to do is to write "I am amending my 1040 to add Form 8891, with no changes to income, credits, or deductions" and sign. Correct??

2. Does the explanantion have to be anything more than this?
What about the rest of the form - Lines 1 to 33?

nelsona · Post by **nelsona** » Tue Dec 18, 2007 9:42 pm

I have already answered these quastions elsewhere and I think you have read these.

cantousa · Post by **cantousa** » Wed Dec 19, 2007 9:51 am

Thanks Nelsona. I appreciate all the help and great service you are providing to the people on the forum.
I read lot of posts related to 8891 and I did not see an answer specific to my question. I am about to mail 1040X and I did not want to do anything silly like not filling out the fields I am supposed to. I will go through the posts again and see if I can find an answer to my questions. Trust me, I did NOT ask the question just for the sake of it, I simply did not want to mail out an incompletly/incorrectly filled form. Once I put it in the mailbox it is out of my hand.

cantousa · Post by **cantousa** » Wed Dec 26, 2007 1:19 am

Nelsona,

I have another question about filing 1040X and 8891. In 2006, I received about $200 of distribution on the RRSP I am including on 1040X/8891. I put on 8891 (Line 7a) $200. Then it says I should put it on line 16a on my 1040. Looking at 1040X, there is no means to amend line 16a of 1040. How do I handle this? Because line 16b on 1040 would anyway be $0, there will be no change to income. So do I need to worry about it even? Thanks.

Best regards,

-UC

nelsona · Post by **nelsona** » Wed Dec 26, 2007 9:35 am

I think you are confusing what is meant by 'distribution'.

What you are probably talking about is a dividend or cap gains distribution that was made to your RRSP but kept inside your RRSP (ie. you did not get a check for that amount).

The distribution refered to on 8891 is actual withdrawals made from your RRSP.

If you actually did receive a check, then this would be taxable in canada, and all or some of it would be taxable in US as well.

In summary, unless you have actually taken money outside oif your RRSP, you do not report anything on line 7a. If you do take maoney out, it is ALL reported on 7a (and 16a of 1040), and you must then separetely determin how much of that is taxable, according to your choice of the various schemes I have outlined several times elsewhere.

cantousa · Post by **cantousa** » Wed Dec 26, 2007 9:54 am

I have not received any check. Everything is inside RRSP and I do not plan on cashing them in near future. By distribution, I am referring to the capital gains distribution and interest income of some sort (within my RRSP, 20% of the money is in some type of GIC which paid some interest last year) which gets re-invested within RRSP. To summarize, all the "distributions" have always been inside RRSP and I have not taken any money outside of RRSP.
So I simply put $0 for 7(a) and 7(b) ? Thanks.

nelsona · Post by **nelsona** » Wed Dec 26, 2007 10:33 am

nelsona · Post by **nelsona** » Wed Dec 26, 2007 10:49 am

Since you are not planning to take any money out of your RRSP, you should focus an making sure you have the exact BOOK value (which is not marklet value) on the day you became a US taxpayer (which in Jan 01 of the year you filed a full 1040 or, some other date if you filed a partial 1040, in the year you arrived in US), this will erve as the basis for all future determinations of what is and is not taxable when you take distributions from your RRSP.