Canadian citizen living in USA as a permanent resident + RRSPs......
I now live in the USA (10+ years), but still have RRSPs in Canada. I am told by the bank that they can no longer advise me on the RRSPs because I reside in the USA. They recommend that I cash out, paying 25% tax, and reinvest the money in the USA. I am told there is a tax treaty between the USA and Canada, and that I will not be double-taxed.
I would really prefer to change my RRSP plan (as it is outdated), and keep the money in Canada.
Any advise/ recommendations?
Technically this is not a double taxation. You have to pay deferred taxes from your RRSP contributions made while you were resident of Canada. In my experience (do not take it as a complete truth though), the only way out is to re-establish residence in Canada and s-lo-w-l-y withdraw your RRSP showing a low income and thus not paying much taxes. In general, it is a mistake to think that such cross border problems are regulated well and fair. In my opinion, it is a mess. Good luck.
Someone who is a tax resident of Canada can contribute to an RRSP and/or a TFSA at any time and without regard to where they reside in the world. Your bank cannot make the decision whether or not you are an actual tax resident, only CRA can do that and they have a form/checklist that will determine your status.
The form is here: