QUESTION: I purchased shares in some Canadian Income trusts thru my tax-qualified IRA (individual retirement acct). Approx 15% of the dividend payment appears to have been with-held. I have read that the Canadian government is doing this to make sure income taxes are paid on these dividends, etc but I have also read that there is a taxform or a method for a U.S. investor in Canadian trusts to receive credit for this tax on our own tax returns so we aren't penalized by holding this investment in what would normally be a taxdeferred vehicle (IRA). Please explain the procedure and Forms for this process. Thank you. ----------------------------- david ingram replies: I know of no way to claim the 15% tax back inside an IRA and for the life of me, can not understand "why" anyone would buy a Canadian Income Trust in a US IRA. The whole reason for buying a Canadian Income Trust is to get tax free capital returns. When you put the trust into an IRA, you are making tax free money taxable. Buy the trust OUT of the IRA as soon as possible. If you have to, borrow the money to buy the trust out. The interest on the loan will be deductible on Schedule A of your US return and the dividends will be taxable on schedule B but you can claim the 15% tax deducted as a dollar for dollar credit on your 1040 by filing US form 1116 with your 1040. Ask a cross-border International real estate rental mutual funds immigration non-resident income tax expert - David Ingram 's CE-NTA Services in North Vancouver BC Canada on It's Your Money CKBD AM600 Fred Snyder's Radio Show Answers to this and other similar questions can be obtained free on Air every Sunday morning. Every Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of Dundee Wealth Management and I, David Ingram will be hosting an INFOMERCIAL but LIVE talk show called "ITS YOUR MONEY" Those outside of the Lower Mainland will be able to listen on the internet at www.600AM.com <http://www.600am.com/> Local calls are taken at (604) 280-0600 and Long Distance calls are taken at 1( 866) 778-0600 I do not know how far the LD line reaches. ========================================= This from "ask an income tax and immigration expert" from www.centa.com <http://www.centa.com/> or www.jurock.com <http://www.jurock.com/> or www.featureweb.com <http://www.featureweb.com/> . 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