# Selling stock from US brokerage ... what to report?



## gibor365 (Apr 1, 2011)

Several years ago i worked for US company (in Canada) and we had kinda Employee Share program non-registered acount, there were partial shares contributions (don't know if there is any difference if employer contributes or employee) with every paycheck ... If I sell those shares.... should get any tax form from US? What form shaoul I fill out in Canada?


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## Guban (Jul 5, 2011)

I don't think you need to worry about any US tax forms even if you get them. Just calculate the capital gain or loss in Canadian dollars and include it on your T1 return in the year of sale.

Hopefully you already filled out a W8BEN, so they know you are Canadian, and are withholding 15% on any dividends. Capital gains are taxed in the country of residence, AFAIK.


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## gibor365 (Apr 1, 2011)

Guban said:


> I don't think you need to worry about any US tax forms even if you get them. Just calculate the capital gain or loss in Canadian dollars and include it on your T1 return in the year of sale.
> 
> Hopefully you already filled out a W8BEN, so they know you are Canadian, and are withholding 15% on any dividends. Capital gains are taxed in the country of residence, AFAIK.


The problem that I cannot calculate any Capital loss or gain, as those transactions were about 8 years ago and I don`t have even online access .... 
What will happen if I don`t report it , CRA will send me letter and I won`t respond (as again have no idea about transaction prices and gain/loss)?


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## Guban (Jul 5, 2011)

If you don't report it, you have nothing to worry about ... Unless you get caught! Canada and the US do share information, but I am not sure about the detail, or if CRA will worry about this. 

Can you not search the historical stock value and currency exchange rate online and get an approximate value?


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## AltaRed (Jun 8, 2009)

gibor said:


> The problem that I cannot calculate any Capital loss or gain, as those transactions were about 8 years ago and I don`t have even online access ....
> What will happen if I don`t report it , CRA will send me letter and I won`t respond (as again have no idea about transaction prices and gain/loss)?


You will have to find out the prices of all your purchases and calculate an ACB. Surely you kept records of same. If not, you will have to go back to the Administrator of that program to get this information. That should not be an issue. It is likely important for the Administrator to provide the ACB of these shares because there may be 'deemed values' involved depending on the nature of the employee sharing program.

As indicated, the IRS and CRA do share information these days. Whether this would fall under the radar is not known, but not reporting the sale of these shares to the CRA on a tax return is akin to standing in the middle of a freeway blindfolded.


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## gibor365 (Apr 1, 2011)

> Surely you kept records of same. If not, you will have to go back to the Administrator of that program to get this information. [/QUOTE Surely I didn't keep any records  It was long time ago and I had no idea what stock market is....
> By Administrator do you mean HR of company where I worked or US brokerage?
> 
> What is it 'deemed values' ?
> ...


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## AltaRed (Jun 8, 2009)

I use the term 'deemed value' because I do not know how your employee profit sharing plan worked (works), i.e. how it calculated the cost of the shares 'given' to you (and thus your ACB) and how they would have reported the annual tax benefit on your W-2/T4 on the value you received each year you received shares. That is why I said "Contact your plan administrator for a copy of these records". At the very least they should have provided you with an annual statement of your account, likely showing Book Value (or Cost Value) and end of year market value.... or something similar. IF not, they would still maintain all the historical records of your account. All you want to know is what shares were given to you and when, and what is the ACB of the aggregate number of your shares.

Ultimately, CRA will not 'penalize' you for not reporting losses (it is to CRA's benefit) but unless you know that, why take the risk of them quering you if they receive data from the IRS? In other words, why risk CRA attention? And more importantly, why risk them potentially flagging your account for potentially multi-year audits of previous tax returns to see if they can uncover other 'problems'?

Added: I don't know if CRA would deem all of your sales proceeds as cap gain if you cannot produce records showing otherwise. If so, they would also most likely assess penalties and interest on the amount.


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## gibor365 (Apr 1, 2011)

AltaRed, so By Administrator do you mean HR of company where I worked or US brokerage?


> why risk CRA attention? And more importantly, why risk them potentially flagging your account for potentially multi-year audits of previous tax returns to see if they can uncover other 'problems'?


This is what I really don't want  ... it's not a big amount ... and looks like a very big mess trying to obtain transactons or be worried about CRA ...maybe I will just give up on this money....


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## AltaRed (Jun 8, 2009)

Someone in the company (or its agent) would have been responsible for oversight of the plan and thus the brokerage accounts. It may be the brokerage provided that service to the employer OR it may be someone in HR of the company you worked for. Is there no company/agent contact phone/email/name associated with your last statement on the Plan? If not, start with the HR department of the company you worked for.

There is no reason for it to be a big mess trying to obtain the transactions. Once you can get hold of someone authorized to dig up that data and send it to you, it should a simple report out of the database.


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## gibor365 (Apr 1, 2011)

My wife also has US stock in US brokerage (at least she has online access ). So, she has 2 kinds of buys, RSU and ESPP... is any difference in calculation of capital gain/loss in this case?


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## AltaRed (Jun 8, 2009)

gibor said:


> My wife also has US stock in US brokerage (at least she has online access ). So, she has 2 kinds of buys, RSU and ESPP... is any difference in calculation of capital gain/loss in this case?


Potentially yes from an ACB perspective. She should have already received tax information when she received the awards and/or triggered the purchases. She needs to contact the issuer of these "awards" to get the scoop.


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## gibor365 (Apr 1, 2011)

AltaRed, could you please explain in simple English? What meaning of "get the scoop"? She got those RSU as well as ESPP many years ago and doesn't have any tax information about it (except online transaction listing)....

Also, if CRA asks for the numbers, you have to send them only buy/sell transaction stament or show all the calculation you did?


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## AltaRed (Jun 8, 2009)

gibor said:


> AltaRed, could you please explain in simple English? What meaning of "get the scoop"? She got those RSU as well as ESPP many years ago and doesn't have any tax information about it (except online transaction listing)....
> 
> Also, if CRA asks for the numbers, you have to send them only buy/sell transaction stament or show all the calculation you did?


I guess I should not use slang/sayings, etc. What I meant is she will need to get all the relevant facts on the ACB of these units from the employer. These are records the employer would have provided at the time your wife received them but your wife apparently no longer has these records. 

Does the online account not have any information on Book Value or Cost Base of these shares? Often such statements include the cost base in addition to current market value. Is there no way to use the Contact Us feature on the website to make inquiries?

Regarding CRA, you would have to provide enough information to give CRA satisfaction that your ACB (cost base numbers) are correct... or at least reasonable in the absence of any other information. At the least, your wife would know the dates each of these shares were purchased and the purchase prices would therefore be obtainable.


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## gibor365 (Apr 1, 2011)

There is Cost/Other Basis price for every Buy (both ESPP and RSU) as well as Unrealized gain/loss for all transactions combined. But Unrealized gain/loss is in $US... Can I just multiple Unrealized gain/loss by FX rate on day I sell or average BoC rate for the year?
Or I need manually convert every buy into CAD$?


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