Foreign Tax
Several foreign stocks in my traditional IRA have taxes “withheld” from my dividends as the dividends are credited to my IRA account. I know I could claim a foreign tax credit on my US Income taxes if the stocks were held in a taxable account, but in the case of my traditional IRA am I just short on luck? Are the foreign taxes withheld just gone as far as I am concerned?
Permalink Submitted by Alan Spross on Wed, 2011-07-13 21:48
Yes, the only way they may be recoverable would be if the withholding was contrary to the tax treaty of the withholding country with the US. For example, Canadian companies are not supposed to withhold on dividends paid on US IRA holdings, but if they do you have to file a claim with the Canadian govt for a refund. This may have changed recently, but have not heard of any changes.
Your IRA custodian is not a party to this since the withholding is done at the source, so you would have to pursue any refund yourself.
Permalink Submitted by GARY WHIPPLE on Wed, 2011-07-13 22:07
Thanks for your reply. It is as I suspicioned.