Fidelity will list U.S. tax info for its funds

Americans living in Canada who have money with Fidelity Investments are getting a helping hand on their taxes. The company says it will start listing the information needed to comply U.S. tax rules available for all its mutual funds.

The company made the move to comply with U.S. investment laws, but any Canadian investors who are classified as American under U.S. tax law will also get the information.

Read: Does your client have U.S. tax risk?

“Fidelity Canada knows that many advisors and investors are concerned about the U.S. Passive Foreign Investment Company rules, which could significantly affect investors who hold Canadian mutual funds that have U.S. tax reporting obligations,” said Peter Bowen, vice president of tax research and solutions, at Fidelity Investments Canada.

For the 2013 tax year and going forward, Fidelity Canada will now provide PFIC Annual Information Statements, upon request, for the full range of its mutual funds; these statements will allow investors to make the Qualified Electing Fund (QEF) election on their 2013 U.S. tax returns.

Read: Americans living in Canada face more U.S. tax considerations

In making the QEF election, investors only include their pro-rata share of the mutual fund’s earned income and capital gains for U.S. tax purposes. This is similar to how U.S. mutual funds are taxed in the U.S. and generally aligned with how Canadian mutual funds are taxed in Canada.

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