Using RRSP to make a Canadian mortgage deductible - NO - David Ingram, Fred Snyder - Singleton, Overs, Evans, Lipson GAAR

Message: question for david ingram:

in reading this passage from your november 2001
newsletter, i am wondering if  this strategy can be used for
mutual funds held in a rrsp?

quote from newsletter:
"for instance, if all you have is a mutual fund account with
reinvested dividends, take the dividends into your
own hands and pay down the mortgage and
borrow the money to buy “about the same” amount
of mutual funds that the dividends would have
bought. this works, even if you borrowed the money to
buy the mutual funds in the  first place. "

david ingram replies:

This does not work for money that is tied up in an RRSP.

For a free seminar on making your Canadian mortgage deductible , read on

Leave Sunday, August 12th open.  I will be conducting a FREE three part seminar on that date at the Holiday Inn at 711 West Broadway in Vancouver.

12 noon to 2:30 PM -    Mortgage Interest as a deduction including Singleton (won), Overs (won), Evans(won)  and Lipson (lost) Cases.

3 PM to 5 PM -    Reporting rules for US persons with Canadian Financial Accounts and Canadian RRSP accounts.
                           Simply put, a US citizen with no US income whatsoever is supposed to file a US tax return no matter where they live in the world.  More important than that, is the fact that if the US citizen has a Canadian RRSP, it is considered a foreign trust.  Assuming that there is more than  $10,000 US in all the US persons foreign accounts, failure to report the foreign trust (RRSP) to the IRS AND the Department of the Treasury can result in minimum fines of $10,000 (per foreign account) and maximum fines of $500,000 plus 5 years in jail plus 35% of the money in the  RRSP plus 5% for every year not reported.  - O U C H !!!

5:30 to 7:30 PM   US Tax returns - who has to file - aimed at Canadians who have been working in the US and Americans living in Canada or Canadians with  rental property in the US on which they are losing money. Snowbirds should attend this as well if they are in the USA more than 120 days a year.

Anyone intending to attend this seminar about mortgage interest or when a Canadian has to file a return should read the November 2001 newsletter for mortgage interest and information about what Canadians have to file a US return. 

If they are a Snowbird, they should read the April 1994 newsletter.

If they are a dual citizen, the Oct 1993 newsletter - These can be found at in the top left hand box. 

Then anyone who is filing both returns should go to the second box down on the right hand side and read the US/Canada Taxation section.

Print the above out.  Highlight questionable sections and bring them along to the seminar so you remember your questions.
Those interested in the mortgage interest as a deduction concept should read Fraser Smith's, "The Smith Manoeuvre", available at any good bookstore although you may need to have them order it for you.

Phone Fred Snyder’s Office at (604) 731-8900 to register for all or any of the seminars.

david ingram – [email protected] (604) 980-0321

David Ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
My Home office is at:
4466 Prospect Road
North Vancouver,  BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 10 PM 7 days a week  Vancouver (LA) time -  (please do not fax or phone outside of those hours as this is a home office)
email to [email protected]
Disclaimer:  This question has been answered without detailed information or consultation and is to be regarded only as general comment.   Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist for expert help, assistance, preparation, or consu


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