Do You Have to File Form 3520-A for RRSP or TFSA?

For U.S. taxpayers with a Canadian RRSP (Registered Retirement Savings Plan) or TFSA (Tax-Free Savings Account), recognizing IRS reporting requirements is vital. Such accounts fall under distinct categories when viewed through the lens of U.S. tax law. It should be noted that the dual tax treaty US Canada has a fundamental role in shaping the obligations.

Form 3520-A: Required or Exempt?

RRSPs

U.S. taxpayers holding an RRSP can rely on IRS Revenue Procedure 2014-55 to claim a Form 3520-A exemption RRSP. In other words:

• Form 3520-A does not need to be filed.
• Form 3520 can also be avoided.
• Tax deferral is preserved if the treaty election is made on the U.S. return.

However, RRSPs may still generate other filings like the FBAR (FinCEN 114) and Form 8938 if account thresholds are satisfied.

TFSAs

TFSAs do not receive the same treaty protection. The IRS usually treats them as foreign grantor trusts, which can result in the below subjects:

• A requirement to file Form 3520 and 3520-A
• Income inside the TFSA being taxable in the U.S.
• Additional reporting through FBAR if applicable

When FBAR and FATCA Apply

Even if Form 3520-A is not necessary for an RRSP, you may still need to report it under the below documents:

• FBAR for RRSP and TFSA (if all foreign accounts exceed $10,000 in total value)
• Form 8938 for FATCA reporting (depending on your filing status and total foreign assets)

Key Takeaways

• The dual tax treaty US Canada enables RRSPs to grow tax-deferred in most cases, with reduced reporting.
• TFSAs generally necessitate full trust reporting and may generate U.S. tax.
• FBAR reporting applies regardless of tax deferral or treaty benefits.
• Always check the latest thresholds and IRS guidance before filing.

If you need any assistance with RRSP filing requirements US Canada or TFSA IRS reporting, contact Watter CPA for professional help today.