Canada us Tax planning Residents of California that hold RRSPs, LIRAs, RRIFs or other Canadian tax-deferred accounts are subjected to a unique set of tax planning and reporting requirements. While most U.S. states continue to allow Canadian retirement accounts to grow on a tax-deferred basis, California does not take this position. Unfortunately this can present a serious income tax problem for residents of California given the state taxes the annual income distributions (interest and dividends) and realized capital gains inside a Canadian registered plan. Canada us Tax planning What are California’s Tax Rules? Under California tax rules, the state requires its tax residents to include annual investment earnings on their Form 540. Unlike the taxpayer’s U.S. federal return, the State of California (Franchise Tax Board) requires that you pay tax annually on your RRSP earnings. You would be responsible for including your interest (line 8), dividends (line 9)...