CIBC Asset Management offers U.S. tax reporting for mutual fund investors

CIBC Asset Management Inc. will make reporting information available that will help U.S. tax filers who own Canadian mutual funds receive more favourable U.S. tax treatment.

Under U.S. tax law, most Canadian mutual funds are now subject to U.S. Passive Foreign Investment Company (PFIC) rules, which are aimed at limiting the extent to which investors, classified as U.S. persons, can defer U.S. tax through foreign investments.

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The company will provide PFIC Annual Information Statements for Renaissance Investments family of funds, Imperial Pools and CIBC Personal Portfolio Services in non-registered retirement savings accounts, starting with the 2013 tax year. These statements allow investors to make the Qualified Electing Fund (QEF) election on their U.S. tax returns. The QEF election allows for long-term capital gains to be taxed at more favourable rates and interest penalties can be avoided.

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“We are pleased to be among the first Canadian fund providers to offer customized statements that benefit our investors who are affected by this U.S. tax law,” says Steve Geist, president, CIBC Asset Management.

Jamie Golombek, managing director of Tax and Estate Planning with CIBC Wealth Advisory Services, adds, “These new PFIC statements will allow U.S. tax filers to receive the benefits of owning mutual funds without having to worry about potentially punitive U.S. tax consequences.”

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.