How is my US 401(k) or IRA taxed once I become a resident of Canada?

The Canada-US tax treaty extends broadly similar tax deferral to US retirement accounts like a 401(k) or an IRA that Canada gives its own RRSPs, so becoming a Canadian resident doesn't mean these accounts suddenly lose their tax-sheltered character for Canadian purposes. Growth inside the account generally isn't taxed by Canada as it accrues, and Canadian tax generally only comes into play when money is actually withdrawn, similar in spirit to how an RRSP works.

This treaty-based treatment isn't automatic in every respect, however, it has historically depended on making the right election or disclosure with your Canadian return, and the details can differ depending on the specific type of account and how CRA's current administrative practice treats it, so relying on assumptions rather than checking the current requirements is a common source of trouble. Keeping thorough records of contributions, account statements, and any elections made is essential, since Canada will eventually tax withdrawals and needs a clear history to work out amounts correctly.

Anyone who becomes a Canadian resident while still holding a US 401(k) or IRA should get advice specific to their account type early on, rather than assuming Canadian tax treatment mirrors US tax treatment by default.