Canadian working in New York (first year)

QUESTION:

1. I had been working for a Canadian company before Oct 9, 2004. From
January 13 to May 1st, I was send by my company to Florida and work there.
During this period, I got Canadian pay. My income during those 4 month
converted to USD is about $18K

2. My Canadian pay from May to October is about $23K, converted to USD.

3. I left my employer in Canada and joined an American company in NY
starting from October 14. I have US pay now and this should continue to the
end of this year. For this two months, my income is about $20K USD.

4. According to 'Substantial Presence Test', I should be considered as
resident for tax purpose this year. Is this correct? Or should I be a
'dual-status'?

5. What my income will be when I file US tax? Should it be "18k + 23k + 20k"
= $61K, if as it said " world-wide income" should be taxed for resident
alien?

6. What my income will be to Canadian government for this year then? $61K?,
18k + 23k = 41K? or 23K? Please note that I am closing my accounts, giving
up OHIP etc, to prepare for my non-resident status in Canada.

7. An accountant friend of mine told me there is a treaty between the two
countries to ensure people will not be double taxed. I read Publication 597,
and cannot find relevant info. Is what my friend told me true?


Your help will be greatly appreciated.

sincerely


david ingram replies:

You are a departing resident of Canada as of the day you left Canada between
Oct 9 and Oct 14, 2004.

All income earned anywhere up to Oct 9 is taxable in Canada.

At the same time, the income earned in the US from Jan 13 to May 1 is
taxable in the US and will form part of a US tax return on which you will
pay tax for this period and after October 9.

You will then have to figure out what the tax, FICA and Medicare was on the
Jan to May period and you will claim that tax dollar for dollar as a credit
on your Canadian return.