I am dual Canada Us citizen. Resided in Canada for 17 years as only Canadian citizen. Moved to US in 2013 as permanent resident and now a US citizen too and working and living in USA
I started receiving private Canadian pension and would like to know whether I have to report this income to IRS. 2020 income is less than CAD 4K
Dual Citizen Residing and Working in USA
Moderator: Mark T Serbinski CA CPA
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Re: Dual Citizen Residing and Working in USA
As a US person (i.e, US tax resident ) you have to report world wide income. Of course the treaty opens up lot of exceptions. Read IRS pub 597. I see this paragraph (see below) in 597 pertaining to your question:
Pensions, Annuities, Social Security, and Alimony
Under Article XVIII, pensions and annuities from Canadian sources paid to U.S. residents are subject to tax by Canada, but the tax is limited to 15% of the gross amount (if a periodic pension payment) or of the taxable amount (if an annuity). Canadian pensions and annuities paid to U.S. residents may be taxed by the United States, but the amount of any pension included in income for U.S. tax purposes may not be more than the amount that would be included in income in Canada if the recipient were a Canadian resident.
Pensions. A pension includes any payment under a pension or other retirement arrangement, Armed Forces retirement pay, war veterans pensions and allowances, and payments under a sickness, accident, or disability plan. It includes pensions paid by private employers and the government for services rendered.
Pensions also include payments from individual retirement arrangements (IRAs) in the United States, registered retirement savings plans (RRSPs) and registered retirement income funds (RRIFs) in Canada.
Pensions do not include social security benefits.
Pensions, Annuities, Social Security, and Alimony
Under Article XVIII, pensions and annuities from Canadian sources paid to U.S. residents are subject to tax by Canada, but the tax is limited to 15% of the gross amount (if a periodic pension payment) or of the taxable amount (if an annuity). Canadian pensions and annuities paid to U.S. residents may be taxed by the United States, but the amount of any pension included in income for U.S. tax purposes may not be more than the amount that would be included in income in Canada if the recipient were a Canadian resident.
Pensions. A pension includes any payment under a pension or other retirement arrangement, Armed Forces retirement pay, war veterans pensions and allowances, and payments under a sickness, accident, or disability plan. It includes pensions paid by private employers and the government for services rendered.
Pensions also include payments from individual retirement arrangements (IRAs) in the United States, registered retirement savings plans (RRSPs) and registered retirement income funds (RRIFs) in Canada.
Pensions do not include social security benefits.
Re: Dual Citizen Residing and Working in USA
The pension should be being withheld 15% in Canada. Make sure of that.
Then also report the income in US as pension, and use the 15% as a credit on form 1116 (general limitation income).
Then also report the income in US as pension, and use the 15% as a credit on form 1116 (general limitation income).
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing