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    bella712's Avatar
    bella712 Posts: 6, Reputation: 1
    New Member
    		  
    #1

    Jun 22, 2011, 07:13 PM
    Benifinary IRA
    I'm Canadian citizen and my uncle was an american citizen, I was name as the beneficiary for his IRA, now I need to liquidate his IRA and transfer them to Canada, my understanding is since this is an IRA I have to pay taxes to IRS, but according to the security firm holding this IRA I have to check with canadian accountant, my question is
    Should I pay taxes to IRS and what is the percentage of the taxes or I should liquidate without paying taxes and pay the taxes in Canada.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Jun 23, 2011, 10:05 AM
    If the IRA was a traditional or SEP IRA, then you WILL have to pay taxes on the IRA distribution to the IRS. The IRA is considered deferred compensation, so it is taxable to either the IRA owner or, if deceased, his/her heirs.

    If you pay taxes to the IRS, you should be able to claim a credit on your Canadian tax return if you determine that the distribution is also taxable under the Canadian tax system.

    If you need help filing the U.S. return (Form 1040NR), please email me at [email protected].
    bella712's Avatar
    bella712 Posts: 6, Reputation: 1
    New Member
    		  
    #3

    Jun 23, 2011, 01:29 PM

    What is the percentage that I have to pay to the IRS?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Jun 23, 2011, 04:00 PM
    I believe it is 10%, but I have to research the tax treaty to be sure.

    It MAY be progressive, which means the tax rate is determined by the amount of the IRA.
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