RRSP withdrawal - US PR

[Elvis Lafleur]

I did a partial withdrawal of 9,450 CAD from RRSP in Nov 2018 (One-time thing; I'm not retired). I received an NR4 showing the 9,450 CAD in gross income (box 16) and 2,362.50 CAD non-resident tax w/h (box 17). My net was 7,087.50 CAD, and this was exchanged by my US bank as a deposit of 5,042.52 USD, effectively a rate of 0.711467.

For US return (I'm using TurboTax), I assume I'd apply the exchange rate above to derive the USD amounts I need. Is the:
--"total distribution" the gross amount? (i.e. 9450 x 0.711467 = 6,723.36 USD)
--"taxable part of distribution" the net amount? (i.e. 7087.5 x 0.711467 = 5,042.52 USD)
--foreign tax credit (or foreign tax deduction) the amount withheld? (i.e. 2362.5 x 0.711467 = 1,680.84 USD)

thanks very much!

[nelsona]

The US taxable portion has nothing to do with how much tax was withheld. Your taxable portion is a calculation that you would have made when you entered US based on the book values of the RRSP at that time in USD.

Please search for the 100 or so times this has been covered here. If you are not able to detetermine this, then the withdrawl is 100% taxable, meeanimng that both the gross and taxable portion are identical: 6700 by your calculation.
For foreign exchange, you really should be using published rates on the date you withdrew, not the rate you got at the bank.

In future, do any exchanges to US in Canada, at the bank you keep in Canada, and then bring that US money into US, you will not get robbed like you were by the US bank.

[Elvis Lafleur]

Merci beaucoup

[Elvis Lafleur]

...shot that off too soon - did mean to ask: Is the foreign tax credit for my 1040 the USD equivalent of the 25% that was withheld?

thanks again

[Elvis Lafleur]

...shot that off too soon as well; reviewed a similar question & response. Thank you

[nelsona]

You can use the entire foreign tax paid on your 1116 towards the credit, It will not all be used and can be carried forward.

[Elvis Lafleur]

Thank you Nelsona