locked in GIC transfer to US IRA?

[burnsis 0]

I have a locked in GIC at CIBC that I transferred money into from a pension several years ago. I've forgotten about it until now. I am not supposed to be able to withdraw it until I am of retirement age as far as I know. But since I am now a US permanent resident with no intent of returning home to Canada...I want to get it transferred here somehow, perhaps into an IRA. When I call CIBC, no one seems to be able to help me since I don't have a regular bank acct with CIBC, and my info is not current.

Anyone have experience with this? What happened?

Thanks in advance!

[nickbits 43]

i think you'll have to keep the account in canada

[AZKira 3]

Is this a GIC within a locked-in RRSP or is it just a GIC that hasn't come due yet? If it is just a GIC, once it has come due you can withdraw the money. If it is a GIC within a locked-in RRSP - big difference.

I went through this about a year ago with a locked-in RRSP at TD Canada Trust. It is complicated and time consuming and frustrating.

First of all, is it a federally-regulated or provincially-regulated RRSP, and if provincial, which province. Rules are different.

You have to have been a Canadian non-resident for two years (dated from when you did your "Departing Canada" tax return) and you have to apply for and receive your NR-73 statement of non-residency from CRA. The bank will need it to unlock the funds.

If you unlock and withdraw the money the bank will withhold 25% (Canadian income tax). If you unlock but leave the money as a "normal" RRSP there is no withholding until you cash it out.

I had to go to the bank (any branch in Canada) in person to do the unlocking and to set up the new RRSP, and it could not be mutual funds, only GICs. The Canadian bank can't sell you mutual funds once you are a non-resident.

As far as converting to an IRA - that's completely separate and unrelated. You can sell the RRSP and buy the IRA but cannot transfer directly from one to the other.

I hope this helps. It is not an easy process. Good luck!

[Udella&Wiz 325]

Excellent info AZKira - I also have LIRA (Locked in retirement account) with my old employr. I'm going to see if I can withdraw it and what the tax implications will be here.

anyone have thoughts on bringing a large sum in from a previous Cdn retirement fund?

[AZKira 3]

Once the RRSP has been unlocked and the money has been cashed out, it is no different than if it had been sitting in a savings account. Best way is to have the bank do a wire transfer to you at your U.S. bank.

[AZKira 3]

By the way - everyone with money in Canada in RRSP, locked or unlocked, or money in a savings account, or any other type of account - there are extra forms that have to be filled in when you do your U.S. taxes.

See TDF 90-22.1 for any non-U.S. account for which you have signing authority, AND 8891 for RRSP, AND the last two questions of Schedule B of the 1040. Big penalties possible if these are not done.

[Flames9_RN 358]

http://forums.serbinski.com/ you can ask/research on this forum. Dude by the name of "Nelsona" answers most of the questions!

[AZKira 3]

I agree - NelsonA and the Serbinski forum are great resources, and another good one is David Ingram at www.centa.com.

NelsonA also answers questions at http://forum.keatsconnelly.com/.

Edited November 1, 2010 by AZKira

[Flames9_RN 358]

Just beware, Nelsona gets grumpy,lol so try and search first!

[Udella&Wiz 325]

Just beware, Nelsona gets grumpy,lol so try and search first!

Grumpy does not describe him well enough - but he's helpful

[Flames9_RN 358]

I used to follow him a lot back in 2003/2004 and he is a hoot,lol!! he does give good advice 9most of the time) but he thinks rather highly of himself,lol! Just have to take him with a grain of salt, of course its the internet, so hard to get a true grasp of his intentions,lol