To receive money from Canada to the US, your sender chooses between an international wire through the SWIFT network, a digital platform such as Wise or Remitly, or a mailed bank draft, and you give them your U.S. account details so the funds can land. The transfer itself is not taxed on arrival, but what the money represents — a gift, a business payment, a retirement withdrawal — decides whether you owe income tax, and separate reporting forms kick in once certain dollar thresholds are crossed. The penalties for missing those forms can easily exceed the transfer fees, so the mechanics and the paperwork both matter before any money moves.
Three Ways the Money Can Reach You
An international wire through SWIFT is the standard route for larger sums. Your sender initiates the wire at their Canadian bank, and the payment is routed through the SWIFT messaging network to your U.S. account. This works well for one-time high-value transfers such as inheritance distributions, real estate proceeds, or business payments.
Digital platforms like Wise and Remitly bypass traditional wire infrastructure by using local account networks in each country. Your sender deposits Canadian dollars into the platform’s Canadian account, and the platform releases a matching U.S. dollar amount from its American account into yours. Settlement is often faster than a bank wire and the fees tend to be lower, which suits smaller or recurring transfers like freelance payments or family support.
Paper still works. A Canadian bank can issue an international bank draft or money order payable in U.S. dollars, which you deposit at your American bank. These instruments are backed by the issuing bank rather than the sender personally, but they take longer to clear and can be lost in the mail.
Banking Details Your Sender Will Ask For
For a SWIFT wire, the Canadian sender needs:
- Your full legal name exactly as it appears on the receiving account.
- The bank name and the physical address of the branch where the account is held.
- The SWIFT/BIC code, an 8- or 11-character identifier for your bank on the SWIFT network.
- The wire routing number, a nine-digit number that may differ from the routing number printed on your checks.
- Your full account number.
You’ll find the SWIFT code and wire routing number in the “Wire Instructions” section of your online banking, on a recent statement, or by calling your branch. Don’t assume the routing number on your checks is the right one for international wires; many banks assign a separate number for that purpose. Your sender may also ask for a Canadian transit and institution number, which are the domestic equivalents in Canada’s system and roughly correspond to American routing information.
Some U.S. banks require you to complete an internal authorization form before releasing an incoming international transfer. Completing it in advance keeps the wire from sitting in a holding account while the bank tries to reach you.
When an Intermediary Bank Gets Involved
If your bank and the sender’s bank do not have a direct relationship, the wire passes through one or more intermediary (correspondent) banks that handle currency conversion and bridge the two banking systems. Each intermediary can deduct its own fee, commonly $15 to $30, from the transfer in transit, so the amount that lands can be smaller than what was sent. If your sender’s bank asks for an intermediary bank name or SWIFT code, get it from your U.S. bank and pass it along; supplying it upfront can reduce both fees and processing time.
What It Costs to Receive the Transfer
Two costs matter. The first is the flat incoming-wire fee your bank charges, commonly ranging from zero to about $25. Some banks waive it for premium tiers or high-balance customers, so check your account terms.
The second cost is less visible: the exchange rate markup. When your bank converts Canadian dollars to U.S. dollars, it applies a rate less favorable than the mid-market rate you would see on a currency site, and the spread can add up meaningfully on a large transfer. Digital platforms typically quote rates closer to mid-market, which is a big part of why they’re popular for recurring payments. On any sizable transfer, compare the total delivered amount after all fees and conversion across two or three services before choosing.
How Long It Takes and Why Wires Get Held
A SWIFT wire generally arrives as a pending transaction within one to two business days, with another day or two for the bank’s compliance review before the funds are available to withdraw. Digital platforms can be faster, sometimes clearing within hours between pre-verified accounts.
Common causes of delay or rejection:
- Mismatched account details. If the name, account number, or routing number is wrong, the receiving bank may hold the funds for manual review or return them.
- Sanctions screening. U.S. banks are required to screen incoming wires against the Office of Foreign Assets Control (OFAC) lists. A match or close match to the Specially Designated Nationals list means the bank must freeze the funds and report to OFAC, and transfers involving sanctioned parties are returned to the sender.
- Compliance inquiries. For large or unusual transfers, your bank may ask you to explain the source and purpose of the money before releasing it. Having a property sale agreement, inheritance letter, or invoice ready clears these holds quickly.
If the transfer comes through a digital platform, watch for an email asking you to log in and confirm the deposit; the platform won’t release the funds to your bank account until you do.
Whether You Owe Tax on the Money
The IRS does not tax incoming international transfers as such. Whether you owe anything depends on what the payment represents.
Gifts and Inheritances
Money received as a personal gift from a Canadian individual, or as an inheritance from a Canadian estate, is generally not taxable income to you. The United States does not tax the recipient of a gift, and the U.S.-Canada tax treaty does not cover gift taxes. You may still have to file Form 3520 — reporting is not the same as owing tax.
Business and Freelance Payments
Payments from a Canadian client for services, freelance work, or goods sold are taxable income and go on your regular return, the same as domestic earnings. Canada may withhold tax at a default rate of 25 percent on certain payments to non-residents, though the U.S.-Canada treaty reduces this rate for many categories of income. If Canadian tax is withheld, you can generally claim a foreign tax credit on your U.S. return to avoid being taxed twice on the same income.
RRSP and RRIF Withdrawals
If you’re a U.S. resident withdrawing from a Canadian Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF), the distribution is taxable on your U.S. return. Under the U.S.-Canada treaty, you can elect to defer U.S. tax on income accruing inside the plan until you actually withdraw. Canada may withhold tax on the payment; the treaty caps this at 15 percent for periodic pension payments, though lump-sum withdrawals can be taxed at higher rates. A foreign tax credit for the Canadian withholding reduces your U.S. tax on the same distribution.
Reporting Requirements That Carry Real Penalties
Several forms may be triggered by receiving money from Canada or by holding a Canadian account. None of them create tax by themselves, but the penalties for missing them are steep.
Form 3520 for Large Gifts and Inheritances
If gifts or bequests from a nonresident alien individual or a foreign estate total more than $100,000 in a single tax year, you must report them on IRS Form 3520, identifying separately each gift exceeding $5,000. A lower threshold applies to amounts from foreign corporations or partnerships; for 2024 that threshold was $19,570, adjusted annually for inflation. The IRS has not yet published the 2026 figure, so confirm the current number on the IRS “Gifts from Foreign Person” page before filing.
Form 3520 is due with your income tax return, typically April 15, extended to October 15 if you extend your return. The penalty for failing to file is 5 percent of the unreported gift amount for each month the failure continues, up to 25 percent. On a $200,000 inheritance, that’s up to $50,000 in penalties on money that wasn’t taxable to begin with.
FBAR for Canadian Accounts Over $10,000
If you have a financial interest in or signature authority over any accounts outside the United States — Canadian bank, brokerage, or mutual fund accounts included — and their combined value exceeds $10,000 at any point during the calendar year, you must file FinCEN Form 114, commonly called the FBAR. It applies even if the balance crossed $10,000 for only a single day, and even if the account is now closed.
The FBAR is filed electronically through FinCEN’s BSA E-Filing System, not with your tax return. It’s due April 15, with an automatic extension to October 15 that requires no request. Penalties for non-willful failure can reach over $16,000 per violation; willful violations carry the greater of roughly $165,000 or 50 percent of the account balance, plus potential criminal exposure.
This matters for Canada-to-U.S. transfers because many recipients also hold a Canadian account — a joint account with family, an account kept after moving south, or one opened to receive the inheritance itself. If that account crossed the threshold at any time in the year, the FBAR is required.
Form 8938 Under FATCA
The Foreign Account Tax Compliance Act (FATCA) may separately require you to file IRS Form 8938 with your income tax return. It covers a broader range of assets than the FBAR, including foreign securities and interests in foreign entities, and uses higher thresholds:
- Single filer in the U.S.: specified foreign assets exceeding $50,000 on the last day of the year, or $75,000 at any time during the year.
- Married filing jointly in the U.S.: $100,000 on the last day, or $150,000 at any time.
- Married filing separately in the U.S.: same as single — $50,000 or $75,000.
Form 8938 attaches to your annual return; the FBAR goes to FinCEN. If you meet both sets of thresholds, you file both.
Form 8300 for Business Cash Receipts
If you receive the money in a trade or business, any single transaction (or related transactions) of more than $10,000 in cash or cash equivalents requires you to file IRS Form 8300 within 15 days. “Cash” here includes currency, cashier’s checks, bank drafts, traveler’s checks, and money orders with a face value of $10,000 or less. A standard international wire is not “cash” for this rule, so a $50,000 wire from a Canadian client does not trigger Form 8300 by itself; $12,000 in money orders from the same client would. Your bank separately files a Currency Transaction Report for cash transactions over $10,000, but that filing is on the bank, not you.