The Investment Dealers Association of Canada is reminding its members to ensure that they meet the Internal Revenue Service’s filing requirements for U.S. beneficiaries of RRSPs.

An earlier IDA bulletin indicated that U.S. beneficiaries of RRSPs may elect to defer tax in the U.S. for income accrued in a RRSP. If this election is made, the U.S. will not tax income accrued in the RRSP until the amounts are distributed to the beneficiary. The bulletin went on to detail how such election is to be made.

The IDA reports that the IRS indicated that it is contemplating a simpler information reporting regime for U.S. beneficiaries of RRSPs in future years, “but gave no indication as to what such regime would be or when it would be instituted”.

“However, as the Internal Revenue Service has not yet made a ruling on this issue and the deadline for filing the requisite materials is August 15, the association reminds members and their clients to contact their tax advisors regarding the requirement that forms reporting these transactions be filed, and the procedure for filing such forms,” it counsels.

The IDA says that it continues to work with a consortium of interested parties that includes The American Chamber of Commerce in Canada to obtain a more simplified filing process for U.S. beneficiaries of RRSPs.