8891 - TD F 90-22.1 - Reporting Canadian RRSP to IRS and Dept of the Treasury
QUESTION:
I contributed to a RRSP up to 1992 and then moved to the US and did not make
any contributions after that. Since '92, I have lived in the US, filing US
taxes. I have not withdrawn any funds from the RRSP. The value of the RRSP
has declined since '92. I did not know about 3520, 3520-A or the new 8891
form until today and was wondering how I can file/submit forms to rectify
this problem?
David ingram replies:
The official rule is that you should have filed the equivalent of an 8891
form for the past 13 years. I am amazed that your RRSP account has gone
DOWN since 1992 however. What do you have in it that is declining for 13
years.
No accounts should do that and you should have it analyzed by someone like
Fred Snyder at (604) 731-8900 www.mutualfund101.com
Because you live out of the country, Fred can NOT deal with you to change
the account but I am sure that we can give you some advice on what you
should do or not do, even if it means cashing it in and using the money in
the USA.
Goto http://www.irs.gov/pub/irs-pdf/f8891.pdf for an example of the Form
8891
Fill in the form as if you are the beneficiary.
Send them in for 2002, 2003 and 2004 and the IRS should be happy.
At the same time, look at the bottom of Schedule B of your 1040. Your RRSP
counts as a foreign account and if there is more than $10,000 US in the
account you must also fill in form TD F 90-22.1 which you can find at:
http://www.irs.gov/pub/irs-pdf/f9022-1.pdf
Note that this is far more serious than not filing form 8891 - The penalty
for not filing the TD F 90-22.1 is up to $500,000 PLUS 5 years in jail.
This form does NOT go to the IRS or with your tax return. Send it to the
Department of the Treasury in Detroit at the address on the form.
I contributed to a RRSP up to 1992 and then moved to the US and did not make
any contributions after that. Since '92, I have lived in the US, filing US
taxes. I have not withdrawn any funds from the RRSP. The value of the RRSP
has declined since '92. I did not know about 3520, 3520-A or the new 8891
form until today and was wondering how I can file/submit forms to rectify
this problem?
David ingram replies:
The official rule is that you should have filed the equivalent of an 8891
form for the past 13 years. I am amazed that your RRSP account has gone
DOWN since 1992 however. What do you have in it that is declining for 13
years.
No accounts should do that and you should have it analyzed by someone like
Fred Snyder at (604) 731-8900 www.mutualfund101.com
Because you live out of the country, Fred can NOT deal with you to change
the account but I am sure that we can give you some advice on what you
should do or not do, even if it means cashing it in and using the money in
the USA.
Goto http://www.irs.gov/pub/irs-pdf/f8891.pdf for an example of the Form
8891
Fill in the form as if you are the beneficiary.
Send them in for 2002, 2003 and 2004 and the IRS should be happy.
At the same time, look at the bottom of Schedule B of your 1040. Your RRSP
counts as a foreign account and if there is more than $10,000 US in the
account you must also fill in form TD F 90-22.1 which you can find at:
http://www.irs.gov/pub/irs-pdf/f9022-1.pdf
Note that this is far more serious than not filing form 8891 - The penalty
for not filing the TD F 90-22.1 is up to $500,000 PLUS 5 years in jail.
This form does NOT go to the IRS or with your tax return. Send it to the
Department of the Treasury in Detroit at the address on the form.
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