Canadian NR4

[mblatour]

Has anyone ever had a client provide them with a Canadian NR4? I received one from a client today and the form shows an income code of 9, Gross Income of $3,286.29 and non-resident tax withheld of $492.95. They also received a 1099-DIV showing ordinary and qualified dividends both at the same amount of $3,286.29, and then foreign tax paid equaling the $492.95.

I did some reading up on the the NR4 as I had never seen one before today. Obviously the 1099-DIV is a no-brainer as far a reporting purposes goes in the U.S.
I am wondering however if a Form 8891 must be filed with their return. Also, does my client have some sort of responsiblity to reporting the NR4 up in Canada?

I'm just hoping someone may be more familiar with it and could give some direction or advice as to what may be involved for reporting purposes.

Thanks in advance!
Becky )

[Uncle]

Has anyone ever had a client provide them with a Canadian NR4? I received one from a client today and the form shows an income code of 9, Gross Income of $3,286.29 and non-resident tax withheld of $492.95. They also received a 1099-DIV showing ordinary and qualified dividends both at the same amount of $3,286.29, and then foreign tax paid equaling the $492.95.

I did some reading up on the the NR4 as I had never seen one before today. Obviously the 1099-DIV is a no-brainer as far a reporting purposes goes in the U.S.
I am wondering however if a Form 8891 must be filed with their return. Also, does my client have some sort of responsiblity to reporting the NR4 up in Canada?

I'm just hoping someone may be more familiar with it and could give some direction or advice as to what may be involved for reporting purposes.

Thanks in advance!
Becky )

I deal with dozens of Canadian and Canadian-US tax clients. I have never seen the situation you have described. It sounds like there is no exchange rate calculated. Usually there would be no 1099 matching the NR4, and the taxpayer would report foreign income, foreign exclusion and/or foreign tax credit. The 15% tax rate on the NR4 is required. There is usually no need to do anything in this situation with CRA. If you would require more help, please contact me.

[mblatour]

Uncle -

Thank you for your response.

Becky

[Burke]

Has anyone ever had a client provide them with a Canadian NR4? I received one from a client today and the form shows an income code of 9, Gross Income of $3,286.29 and non-resident tax withheld of $492.95.

I am wondering however if a Form 8891 must be filed with their return. Also, does my client have some sort of responsiblity to reporting the NR4 up in Canada?
Becky )

I am going to assume this is some sort of retirement distribution? I have dealt with T4A-NR which is miscellaneous income and the instructions available from www.cra.gc.ca also mention this form NR4. There is an election under Section 217 about filing in Canada, and possibly getting a refund of some or all of the non-resident tax withheld. Return must be filed by 6/30/11 unless the rules have changed. (You do not have to file -- you can let them keep the tax.) On the US return, of course, you need to convert to USD. And it looks like Form 8891 may be required.