Episode 71: TFSA or Trouble? What Americans in Canada Need to Know
Description
Should an American living in Canada hold a TFSA—or avoid it? Ask 10 accountants and you might get 15 different answers. That’s why this episode of Snowbirds Expat Radio brings in cross-border tax expert Christa Walkden from 49th Parallel Tax.
With nearly 30 years of experience in U.S. and Canadian taxation, Christa breaks down the complexities around Tax-Free Savings Accounts (TFSAs) for U.S. citizens in Canada. She explains the spectrum of filing positions, from the most conservative (treating the TFSA as a foreign trust with Form 3520 filings) to more practical approaches that rely on disclosure and income reporting.
Listeners will also hear:
Why the IRS hasn’t clarified the TFSA’s status—and what that means for you.
How Canadian mutual funds inside a TFSA create extra problems under U.S. PFIC rules.
The pitfalls of transferring TFSAs into U.S.-owned firms (like capital gains surprises).
Why collaboration between advisors, accountants, and immigration lawyers is critical.
When it actually makes sense for Americans to keep a TFSA, depending on their other income and foreign tax credits.
Christa and Gerry also touch on the hope that a future treaty update could treat TFSAs the same way Canada treats Roth IRAs—finally bringing clarity for cross-border families.
Resources
📞 Learn more about Crista Walkden & 49th Parallel Tax: https://49ptax.ca/
United States
