How The U.S. Taxes Canadian Retirement Accounts (RRSP, TFSA)

Описание: How does the U.S. tax the Canadian retirement plans such as RRSP, TFSA, and LIRA?

The U.S. has a tax treaty with Canada, so as a Canadian non-resident living in the U.S., you can enjoy the same tax-deferred benefit on both sides of the border.

How the Federal Government Treats Canadian Accounts
On the federal level in the U.S., the RRSP and LIRA are covered by the tax treaty so they do have the same tax benefits of deferral on both sides of the border. The exception is the TFSA account, where the U.S. doesn’t have any regulations and any investments that you have depending upon GIC.

How the State Governments Treats Canadian Accounts
There are some states that don't go with the tax treaty policy-wise. One of the biggest examples is the state of California. They do tax you on the RRSP income that is being earned in that account. Not the value of the assets, but the income that is being earned in that account. So any interest dividend capital gains that you get in those accounts into your Investments is reportable and taxable by the state of California if you are living in California as a tax resident.

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