What happens to my RRSP and TFSA when I move to the US on TN?

Nothing is forced on either account when you move. Canada’s departure tax skips both: RRSPs and TFSAs are excluded from the deemed sale that hits most other property. Your RRSP keeps deferring tax on both sides of the border, automatically if you’re an eligible individual, with no election to file. Your TFSA stays tax-free for Canada but loses that status in the US the day your residency starts: from then on, its growth is taxable income on your 1040. The traps are contributions after the move and whatever you leave running by accident.

Does moving to the US trigger Canadian tax on your RRSP or TFSA?

No. When you cease Canadian residence, section 128.1(4) of the Income Tax Act deems you to have sold most of what you own at fair market value. That’s the departure tax. Registered accounts sit outside it: the deemed sale carves out “excluded rights or interests,” and subsection 128.1(10) lists the RRSP, the RRIF, and the TFSA by name.

Both accounts cross the border untouched. If you hold taxable investments or private company shares, the deemed sale is still your problem, and that lives in the departure-year forms and the deemed-sale math.

What happens to your RRSP on day 1 of US residency?

Nothing is forced, and nothing needs filing for the deferral itself. Canada keeps deferring tax while the money stays inside the plan. The open question was always the US side, since the IRS doesn’t automatically respect foreign retirement wrappers. Article XVIII(7) of the US-Canada treaty lets a US resident defer US tax on income accruing in a Canadian pension plan until the plan actually pays out, and since Rev. Proc. 2014-55 an eligible individual is treated as having made that election automatically, with no form to file. Eligibility mostly turns on a clean US filing history.

• Eligibility here means you’ve filed the returns you owed, and you haven’t been reporting the plan’s internal earnings as income (section 4.01 has the full conditions). For someone landing on a TN this year, that history starts now, so the bar is easy to clear.
• The old route was Form 8891; the rev proc replaced it.
• The deferral covers income accrued inside the plan and doesn’t extend to new contributions.
• It changes nothing about information reporting: the rev proc takes Forms 3520 and 3520-A off the table for an RRSP, but the account still counts for FBAR and Form 8938. That layer lives in what these accounts add to a US return in reporting.

Article XVIII(7) runs the other direction too, for an American account in Canadian hands: the one-time election for a Roth IRA held by a Canadian resident.

What happens to your TFSA on day 1?

Canada’s answer doesn’t change. A TFSA stays tax-free in Canada even after you leave: the trust itself is exempt under ITA section 149(1)(u.2), and as a non-resident you still face no Canadian tax on its earnings or withdrawals. The US answer changes completely. In the usual case your residency starting date is the first day you’re present in the US during the year you qualify (26 USC 7701(b)), and from that day the TFSA has no special status: interest, dividends, and gains inside it are gross income under IRC section 61, reportable on your 1040 as they’re earned or realized.

On day 1 of US residency	RRSP	TFSA
Deemed sold when you leave Canada?	No, excluded under ITA s.128.1(10)	No, same exclusion
Canadian tax while you hold it from the US	None while the money stays in the plan	None on earnings or withdrawals (ITA s.149(1)(u.2))
US tax on growth	Deferred automatically if you’re an eligible individual (Rev. Proc. 2014-55)	Taxable income on your 1040 as it’s earned or realized (IRC s.61)
Contributions after the move	Nothing in the Act stops it with existing room, rarely worth it	1% per month tax on every non-resident dollar (ITA s.207.03)
US information reporting	FBAR and Form 8938 still apply	FBAR and Form 8938, plus the trust question

The tax-free label doesn’t cross the border, and the deferral that saves the RRSP doesn’t reach the TFSA. Rev. Proc. 2014-55 covers arrangements within Article XVIII(7), plans operated exclusively to provide pension or employee benefits, and the standard read is that a general savings account doesn’t fit that description. The IRS has never said so in as many words. The related argument, whether a TFSA is a foreign trust, and the Form 3520 question, has its own page.

Can you still contribute to either account after the move?

To the TFSA, treat the answer as no. Every dollar you put in as a non-resident draws a tax of 1% per month under ITA section 207.03, and no new room absorbs it, because for a calendar year in which you’re never resident in Canada your room addition is nil (ITA s.207.01). The RRSP is more forgiving on paper. Nothing in the Act stops you from using room you already have from before the move, though a US salary builds no new room and a fresh contribution brings no US deferral.

• The TFSA clock only stops when the contribution comes back out or you become a Canadian resident again. The tax rides on its own return, the RC243, filed and paid before July of the following year (ITA s.207.07).
• Building new RRSP room takes Canadian-source earned income, meaning employment duties you perform in Canada or a business you carry on there (ITA s.146(1), “earned income”).

Should you close each account before you go, or keep it?

There’s no single right answer, only tradeoffs that turn on your bracket, your state, and how long the money can sit. Keeping the RRSP lets the deferral run, at the cost of Canadian withholding when you draw it down; collapsing it makes that withholding immediate. Keeping the TFSA leaves its growth taxable in the US every year, plus the reporting question; closing it first buys a clean US start.

Route	The case for it	The cost of it
Keep the RRSP	The US deferral runs on its own and the balance keeps compounding with no current tax on either side	Later withdrawals face Canadian withholding: 25% by default (ITA s.212(1)), 15% for periodic payments under treaty Article XVIII(2)(a)
Collapse the RRSP	One clean break, no Canadian account to track from the US	If you collapse it, the 25% withholding hits now, the income lands on a US return, and the deferred compounding ends
Keep the TFSA	Canada keeps treating it as tax-free, and the money stays invested	The US taxes the growth every year, and the reporting question rides along for as long as the account exists
Close the TFSA before departure	A clean US start, nothing to report and nothing accruing	The contribution room comes back the following calendar year (ITA s.207.01) and then just waits, useful only if you move back

The first row compresses a whole decision, the 25 percent versus 15 percent math when you eventually draw the RRSP down. The table also can’t answer your state: state rules differ from the treaty, so check how yours treats an RRSP before you lean on the deferral. If there’s a child in the picture, there’s a third account running the same keep-or-close question on a tighter clock, and what happens to an RESP and the CCB when you move walks it. California is the state where that answer diverges most, and it is worked through in moving from BC to California.

What does one move actually look like?

Take a hypothetical mover who lands mid-year holding both accounts and forgets one standing deposit. Neither account is deemed sold on the way out. The RRSP’s growth stays off the US return, the TFSA’s growth goes on it, and the forgotten deposits carry a monthly Canadian tax.

What should I do next?

Before you leave: cancel every pre-authorized contribution to both accounts, and make the TFSA call while closing it still restores room cleanly the next calendar year. After you land: keep your US filings clean, because the RRSP deferral’s eligibility rides on that history, and get both accounts into your FBAR and Form 8938 picture from year one.

• Whether the holdings inside those accounts are PFICs, a separate question from the account wrapper

• Form 8891 is no longer required, but Form 8938 and the FBAR were expressly left standing

This guide is general information, not tax advice for your specific situation. Which points apply, and how, depends on your facts.