I have 3 NR4 from Canada and I am a US citizen. My mother passed a few months back. I have 3 NR4, 1 with code 61 and 2 with code 40. I'm a little confused on how I enter these. My understanding is that I enter them as mock 1099-R but is there a breakdown of what boxes I fill out on the 1099-R The NR4 forms have very little information, they have:Box 16 - Gross incomeBox 17 - Non-resident tax withheldWhen doing the exchange rate do I do it based on todays currency exchange?Where do I get the TIN or do I leave it blank? Do I have to fill out a separate form as well or will the 1099-R suffice?Thank you

You should post an NR4 as a Social Security transaction. Boxes 16 & 17 are all you will need. Enter the NR4, treat it as if it is an SSA-1099 Enter it in the Retirement Plans Social Security section, under ‘Social Security (SSA-1099, RRB-1099)’. Then, go to the Deductions and Credits Select Foreign Taxes under ‘Estimates and Other Taxes Paid’ enter any foreign tax you already paid to Canada on that income. For more info specific to the US/Canadian tax treaty, please see http://www.irs.gov/pub/irs-pdf/p597.pdf Currency exchange may not have been updated for 2022 yet, but they will be published here: Yearly Average Currency Exchange Rates - IRS There is no TIN for Social Security. You should combine all of the NR4's together.

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calums_mom

Solved

NR4 from Canada

Forum|Forum|3 years ago
January 23, 2023
2 replies
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I have 3 NR4 from Canada and I am a US citizen.

My mother passed a few months back. I have 3 NR4, 1 with code 61 and 2 with code 40.

I'm a little confused on how I enter these. My understanding is that I enter them as mock 1099-R but is there a breakdown of what boxes I fill out on the 1099-R

The NR4 forms have very little information, they have:
- Box 16 - Gross income
- Box 17 - Non-resident tax withheld
When doing the exchange rate do I do it based on todays currency exchange?
Where do I get the TIN or do I leave it blank?
Do I have to fill out a separate form as well or will the 1099-R suffice?

Thank you

TurboTax Self Employed Online

Best answer by BillM223

@BillM223 I just spoke to multiple "tax experts" after upgrading my account and they said it's SSA-1099 for code 39. I do not have code 39. They said for code 40 it's 1099-R and code 61 it's 1099INT.

I'm really concerned that I'm being given such different information depending on who answers. It makes it very difficult to trust that I'm going to do this correctly.

Canada says,

"39 - Superannuation or pension benefits – Periodic payments

40 - Superannuation or pension benefits – Lump-sum payments"

Since both of these are government "pension" payments, using form SSA-1099 is a closer fit than a 1099-R. Besides, there is a tax benefit from using the SSA-1099, because SS payments are never taxed at 100%.

The form with code 61 should be treated as if it were on a 1099-INT, since it is "61- Arm’s length interest payments". (See the "Canada says" link above).

You also asked about what exchange rate to use. The IRS generally says that whatever exchange rate you use, you have to be able to justify it. John's link above is a solid choice - it is the IRS's own listing of average exchange rates.

I will ask that the FAQ be updated to reflect the different answers based on the codes on the Canadian forms.

JohnB5677

You should post an NR4 as a Social Security transaction.

Boxes 16 & 17 are all you will need.
1. Enter the NR4, treat it as if it is an SSA-1099
2. Enter it in the Retirement Plans
3. Social Security section, under ‘Social Security (SSA-1099, RRB-1099)’.
4. Then, go to the Deductions and Credits
5. Select Foreign Taxes under ‘Estimates and Other Taxes Paid’
6. enter any foreign tax you already paid to Canada on that income.
7. For more info specific to the US/Canadian tax treaty, please see http://www.irs.gov/pub/irs-pdf/p597.pdf
Currency exchange may not have been updated for 2022 yet, but they will be published here: Yearly Average Currency Exchange Rates - IRS
There is no TIN for Social Security.
You should combine all of the NR4's together.

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PGH62

Hi JohnB5677 - I have a NR4 with Income Code 27 from Canada (income from an investment account my father--in-law had who passed last year). How do I report this income and taxes in Turbo Tax? Thanks in advance!

calums_momAuthor

@JohnB5677 I went in to add SSA-1099 and it states:

Don't confuse the SSA-1099 with the 1099-R that reports retirement benefits from non-SSA sources like pensions, 401(k)s, and IRAs. 1099-Rs are entered elsewhere in TurboTax. As I mentioned in my original post the codes are 40 and 61. This is not retirement benefits.

40 is lump sum payment of pension benefits

61 is arm's length interest payment

These are both inheritance from my mother who passed in Canada. It was her pension that I inherited and the interest is on an insurance policy I received.

Can you please confirm as the SSA-1099 doesn't sound correct based on the info I read above.

BillM223

Please see this Turbotax FAQ. It will confirm that the SSA-1099 is the right way to go.

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calums_momAuthor

@BillM223 I just spoke to multiple "tax experts" after upgrading my account and they said it's SSA-1099 for code 39. I do not have code 39. They said for code 40 it's 1099-R and code 61 it's 1099INT.

I'm really concerned that I'm being given such different information depending on who answers. It makes it very difficult to trust that I'm going to do this correctly.