IRA

[penjoy777]

I am a Canadian citizen working in the US for 3 years. I have been filing my income taxes as a US resident. My stay in US would not last more than 3 years and I might have to return back to Canada. I plan to open an IRA investment account this year. Is it better to open a IRA or a regular investment account if I do plan to return to Canada in couple of years(tax, cashing, additional tax implications while returning to Canada)?

[nelsona]

For such a short time in US, I would not bother with any sheltered accounts. Just invest normally, and then cash out when you leave.

[nelsona]

Look at it this way too: You pay lower tax in US than canada. Why try to save tax at the low US rate, only to pay it back at the higher rate after you leave.

If anything you could put your money in a Roth IRA while in US, and leave it for many years.

But such a small amount, and the hassle of keeping it in US for all these years until you retire....

Better keep it unsheltered, and then use it in canada to plow into your RRSP and/or TFSA and /or house when you go back

[penjoy777]

Thanks. It seems clear when you put it!!! HOwever, there might be a chance that my employer might work on my green card (if work picks up....well hope for!).
If that does happen in next couple of years, then I might rue myself not entering into the market when it was down!

[nelsona]

As I said, you can always invest, just pass on sheltering. If you are going to shelter, then you shoudl go big, witha 401(k) or Roth401(K).

The $%K a year in IRA is just a pain if you leave.