# Living in USA Receiving Canada Pension (QPP)



## CGab (13 d ago)

I am a Canadian by birth & have dual citizenship (USA/CANADA).
I have applied for my QPP pension. 
I live in the USA only.
I know that I can have it direct deposited into my USA bank account but I am wondering if this the best thing to do as I think about the following:

1. If i get direct deposit of the funds put into my USA bank account I know I will be dealing with a drop in the amount from the Canada/US exchange rate AND I will be taxed by the US government on the amount I get.
I therefore am realizing I get hit twice on the funds...first from the loss due to the exchange rate (CDN to USA) *AND* second from the USA taxes.

3. I am wondering is it better for me to instead have the funds deposited in my Canadian Bank account 
*RATHER THAN* my USA bank account *AND* if so:

- am I taxed by the CDN gov or USA gov if I leave the funds in Canada?

- if I leave the funds in Canada do I claim the "Canadian" amount on my USA taxes *OR *do I claim what the "converted amount " (CDN to USA) would be?

-do I get taxed by the USA on the actual CDN amount *OR* on what the "converted amount " (CDN to USA) would be?

- I know I have to pay taxes either way but ...Which choice gets me the best option? Pros? Cons? 
Direct Deposit the funds in a CDN Bank account
Direct Deposit the funds in my USA Bank account

Thank you for any guidance and assistance.
CasG


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## Harry Moles (11 mo ago)

The location of the money is not relevant; the location of you is relevant. You are a US resident. Consult the US-Canada tax treaty to determine which country has primary taxation rights on public pensions. 

The IRS only cares about US dollar amounts, so even if you leave the money in Canada, you will need to apply an exchange rate for US tax purposes.

You don't "lose" money on the conversion as such. The US dollar amount of your Canadian pension will vary over time depending on the exchange rate. There are costs to exchanging money of course, so you would save a percent or two if you left the money in a Canadian bank and only spent it in Canada, without converting to US dollars. If you do want the money in US dollars, investigate how the Canadian government deposits to your US bank, and whether the exchange rate is as good as some of the online exchanges like Wise or Currency Fair.


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## 255 (Sep 8, 2018)

@CGab -- I concur with everything @Harry Moles posted. From my understanding your Canadian pension will be reported on your U.S. 1040, but taxed just like U.S. Social Security retirement -- so only 85% would be taxable. No taxes owed to Canada. 

As far as having your pension paid to a U.S. or Canadian bank -- in my view the exchange rate is paramount. You'll need to check with the Canadian authorities to determine the exchange rate they use. Often times it might e better than bank exchange rates, but bank exchange rates can be horrendous. If the rates are completely "out of whack," you might look at depositing the funds into your Canadian bank then transferring the Canadian dollars into a brokerage account like Interactive Brokers (IB,) change the currency to USD, at spot, then withdraw the funds (USD) to your U.S. bank account. Cheers, 255


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## CGab (13 d ago)

Thank you @Harry Moles and @255 for the info you posted. I do not need the funds in the USA as USA funds, I am not in need of the funds. I can easily leave the funds in Canada and use the money for Canadian purchases/spending whenever I am there & as you say just declare on my US 1040. It seems like the most reasonable solution.


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## Harry Moles (11 mo ago)

That is the simplest solution, as long as you're clear that where you park the money and in what currency you keep it has no bearing on how it is taxed.


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