Canadian with ROTH IRA - real estate mutual funds

QUESTION:
I have recently bought a mutual fund and put it under a
Roth IRA.  I am a Canadian living in the US for a few
years, i  am not sure yet if I plan to move back to
Canada.  What happens if I do move back to Canada-will
i be taxed on the money in the Roth?  Any advice would
be greatly appreciated.  Thank you
---
david ingram replies:
The internal earnings in the ROTH are tax free until
you withdraw the money in the US but are taxable in
Canada under Current rules.  You can find Paul Marin's
entire address on the subject at:
http://www.fin.gc.ca/news98/98-129e.html
The relative passage by Paul Martin when he was finance
minister is reproduced here, the bad part in red:
Ottawa, December 18, 1998
1998-129 - Paul Martin, Finance Minister of Canada
Qualified RRSP Investments and IRAs
Finance Minister Paul Martin today announced that he
will propose changes to the Income Tax Act and the
Income Tax Regulations to address two issues that have
been recently raised with the Department of Finance, in
the context of retirement savings decisions currently
being made by individuals.
The changes to the Code have established a new type of
IRA, known as a Roth IRA. Under the Code, contributions
to a Roth IRA are not deductible, but investment income
accrues tax-free and distributions are generally not
taxable. Under certain circumstances, an individual may
convert an ordinary IRA into a Roth IRA, but is
required to include in computing income for the year of
conversion the value of the ordinary IRA at the time of
conversion. If the conversion is made in 1998, the
income inclusion may be spread out over a four-year
period.
The proposed amendment to the Act would affect Canadian
residents who convert ordinary IRAs into Roth IRAs. It
would require that the individual include in income for
Canadian tax purposes any amount that must be included
in income for U.S. tax purposes. This would ensure that
the conversion amount is taxed in Canada, even where
the IRA is converted simply by amending its terms. It
would also ensure that the amount and timing of the
inclusion in Canada matches the amount and timing in
the U.S., thus allowing individuals to maximize the use
of U.S. taxes paid on conversion as foreign tax credits
in computing Canadian income tax payable.
Mr. Martin noted that the deferral opportunities in the
U.S. for Roth IRAs are far more generous than the
deferral opportunities in the U.S. for ordinary IRAs
and the deferral opportunities in Canada for
tax-assisted retirement savings. In particular,
contributions can be made to a Roth IRA at any age, and
there is no requirement for payments under a Roth IRA
to begin by a certain age. Accordingly, there are no
plans to provide tax assistance by way of an exemption
from or deferral of taxation in Canada on earnings
within a Roth IRA.
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