TFSA capital gains for

xiaoice · Post by **xiaoice** » Thu Apr 06, 2017 4:33 pm

Since this is a TFSA, no T5, T3, statement etc. I can just take screen shot of account details (mutual fund name, average cost, current price, market value). Is that enough for future tax reporting if needed.

nelsona · Post by **nelsona** » Thu Apr 06, 2017 4:48 pm

You don't even get statements from the broker?!

xiaoice · Post by **xiaoice** » Thu Apr 06, 2017 4:55 pm

Oh.. Yes I do. the paper statements, I almost forgot... Thanks. I did not keep the previous ones as thought they are useless.... but I will keep an record from now... hopefully not too late.

nelsona · Post by **nelsona** » Thu Apr 06, 2017 8:08 pm

I'm pretty sure your statements are available on line for a few years.

xiaoice · Post by **xiaoice** » Mon Apr 10, 2017 10:18 am

Just realize that I won't have the option to file dual status but resident for tax purpose because I am going to submit 485 and was in US on Jan 1, 2017. Thus I need to report 3520 any way. Close TFSA now or late this year, won't make much difference, right?

nelsona · Post by **nelsona** » Mon Apr 10, 2017 10:20 am

You are relying o nUS definition of residency. The treaty overrides this. You will be considered Cdn resident until you give up physical residence in Canada. You thus still have the choiuce to file full year or part-year BY TREATY (which you would explain on the 1040NR portion of your dual-status tax-return.

xiaoice · Post by **xiaoice** » Mon Apr 10, 2017 11:30 am

Glad to Know! Thanks a lot, Nelsona.
Just searched on IRS and found the Tax Treaty. It seems I just need to file 1040NR and 8833 Form. Yeah
"If you are an individual who is a dual-resident taxpayer and you choose to claim treaty benefits as a resident of the foreign country, you are treated as a nonresident alien in figuring your U.S. income tax liability for the part of the tax year you are considered a dual-resident taxpayer. If you are eligible to be treated as a resident of the foreign country pursuant to the applicable income tax treaty and you choose to claim benefits as a resident of such foreign country, attach Form 8833 to Form 1040NR, U.S. Nonresident Alien Income Tax Return, or Form 1040NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents. In order to be treated as a resident of the foreign country, you must timely file (including extensions) Form 1040NR or Form 1040NR-EZ with the Form 8833 attached. If you choose to be treated as a resident of a foreign country under an income tax treaty, you are still treated as a U.S. resident for purposes other than figuring your U.S. income tax liability (see Regulations section 301.7701(b)-7(a)(3))."

nelsona · Post by **nelsona** » Mon Apr 10, 2017 11:46 am

Remember though, that the paragraph you are quoting is specifically for FULL YEAR residents of a foreign treaty country. You would still need to file a 1040 for the portion of the year that you were a US resident.

All I was pointing out to you was that, since we already discussed that you had the choice to be part-year or full year, that choice was still available to you, even though you accidentally met the definition of full-year US tax-filing obligation, since you always would be relying on the treaty.

xiaoice · Post by **xiaoice** » Mon Apr 10, 2017 2:33 pm

More clear now. 1040NR and 8833 Form for the portion I physically resident in Canada. 1040 for portion as the USA resident.

I can now sell all TFSA without worrying about 3520.

Thanks again, Nelson.

nelsona · Post by **nelsona** » Mon Apr 10, 2017 3:23 pm

Yes, no worry about 3520 but more importantly not having to include all the gains and income generated from the closure.

jixca · Post by **jixca** » Mon Apr 10, 2017 3:49 pm

So I've finally sorted out all the forms and here's what I'm filing/reporting. Again, single moved May 2016 from Canada to US under TN

Canada:
Federal / ON reporting all income and stock sales until departure date
T1243 listing the money market mutual funds I had (sold at cost a month later, no gains this was used for avoiding exchange CAD/USD)

USA:
1040 part year, with 1040NR as dual status statement, reporting world income after May 2016.

8938 all accounts including RRSP/TFSA...etc
FBAR all accounts including RRSP/TFSA...etc
8621 due to the money market mutual fund above

3520 for each TFSA with 3520A page 3 as reference statement. Income reported in 1040 as interest and one dividend.

3520A for each TFSA with account terms as statement.

Question

1. Do I need 8833 and 1116? I am not claiming foreign tax credit since I didn't report Canadian income on part year 1040/1040NR. I don't need 8833 because I'm not electing to file full year 1040, is that correct?

2. I'm late for 3520A, should I include a statement explaining why? I see some argue that IRS doesn't care about 3520/3520A but I'm filing just to be safe. The amount inside the TFSA is insignificant (under 200)

nelsona · Post by **nelsona** » Mon Apr 10, 2017 4:31 pm

1. No
2. Why do you say it is late?

jixca · Post by **jixca** » Mon Apr 10, 2017 4:43 pm

1. Do I need 8833 to exclude the RRSP already reported in 8938/FBAR? I thought 8833 is just used for electing to file full year 1040 which I am not doing

2. 3520A is due March 15 no?

nelsona · Post by **nelsona** » Mon Apr 10, 2017 5:10 pm

1. No.
2. you can submit a 7004 form to extend 6 months.

nelsona · Post by **nelsona** » Mon Apr 10, 2017 5:15 pm

1. No.
2. you can submit a 7004 form to extend 6 months.