This is a multi-part message in MIME format.
---------------------- multipart/alternative attachment
-----
QUESTION:
My wife and I returned to Canada in June 2003. I was on an H1B visa and =
we
had been in USA for 5.5 years. My house in Canada was rented out for the
period and I had field the form when I left claiming it as 'still my
residence for 4+ years' for tax purposes. I had US earnings in the first
half of the year, cashed in stock options and sold our US house at a =
small
profit. My wife was not working in USA and we filed a joint tax return =
each
year. I was offered a job in Canada which prompted my return after 5.5 =
years
so I have moving expenses that I hope can be deducted on a Canadian =
return.
My questions are:
1. Do I have to prepare a US and Canadian return this year
2. Assuming I have to do both, do I only get half a year's allowances in
Canada and in USA?
3. Since I arrived back in June, and spent about 15 days in USA in =
October,
can I use the 183 rule to only file in USA for this year (after =
deducting
the 15 days I would be under 183 in Canada)
4. If I have to prepare both returns will Canada have a claim on the =
small
profit I made on the house that closed before I left, and the small =
profit I
made on the stock options.
5. Can I still shelter some of my earnings in the first half of the year =
in
my IRA now that I am out of the country?
6. Since my wife has no earnings this year, how much can we take out of =
her
RRSP without paying over about 25% in tax.
7. I am told that since I have about =9225 units=92 in the US pension =
plan (OAS
I believe it is called) and that prior to leaving for USA I had over 20
years working in Canada, that I am entitled to a US pension which can =
begin
at 62 (I am now 59). Can you confirm that this is true and let me know
approximately how much I might get at 62.
8. How much would you charge to do my tax returns for 2003
Thanks for your help.
Your web site has already provided me with a lot of help.
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D
david ingram replies:
What an interesting set of questions. You will NOT like some of the =
answers but it is better to know now and not get hit with unexpected =
taxes and penalties and interest later on.
In order
1. You will have to prepare a US 1040 reporting your world wide =
income and claiming foreign tax credits or file a 1040NR (under Article =
IV of the US Canada Tax Treaty this year and a part year resident state =
income tax return if you were in a state that has a tax filing system. =
You will also have to file a Canadian Tax return showing your arrival =
date in Canada. Your extra days in the US have no bearing on the =
Canadian return.
2. Canada will give you a prorated half year's exemption amount. The =
US will allow you a standard deduction if you file a 1040 reporting your =
Canadian Income as well or itemized deductions if you file US income =
only on a dual status 1040 or a 1040NR.
3. The fifteen days is irrelevant. You will be counted from the day =
you and your family re-established Canadian Residency.
4. Canada will have no claim on your stock options or US house =
profit.
5. Yes.
6. about $4,000 - However, you will pay tax on that amount because =
you will lose her as an exemption amount. It will do no good tax wise.
7. OAS is the Canadian Old Age Security Pension and has "nothing:" to =
do with the US pension. You can use some of your CPP credits to top up =
your FICA under the Totalization agreement with the USA. Write to the =
Social Security administration and ask them to give you a printout.
8. $600 to $1000 Canadian. Stock options, house sale and your moving =
back into a Canadian Rental House makes it higher BECAUSE:
The Section 45(2) election you made on your rental house DOES NOT APPLY =
when you leave Canada and do not report your US earnings to Canada every =
year and pay tax to CANADA as a Resident.
THEREFORE, you triggered a tax bill on any capital gains tax the day =
that you moved back into your rental house. You must calculate this tax =
and then apply for a delay in paying until actual sale by making another =
election under Section 45(3). You can ask 59 accountants in a row who =
will not recognize this unless they specialize in cross border tax =
returns.
And last but not least, your move back to Canada does not result in any =
tax deduction on your Canadian return.
David Ingram's US/Canada Services
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Calls accepted from 10 AM to 10 PM 7 days a week
Res (604) 980-3578 Cell (604) 657-8451
(604) 980-0321=20
[email protected]
www.centa.com www.david-ingram.com
Disclaimer: This question has been answered without detailed =
information or consultation and is to be regarded only as general =
comment. Nothing in this message is or should be construed as advice =
in any particular circumstances. No contract exists between the reader & =
the author and any and all non-contractual duties are expressly denied. =
All readers should obtain formal advice from a competent financial, or =
real estate planner or advisor & appropriately qualified legal =
practitioner, tax or immigration specialist in connection with personal =
or business affairs such as at www.centa.com. If you forward this =
message, this disclaimer must be included."
This from "ask an income tax and immigration and bankruptcy expert" from =
www.centa.com or www.jurock.com or www.featureweb.com. Canadian David =
Ingram deals daily with tax returns dealing with expatriate:
multi jurisdictional cross and trans border expatriate problems for the =
United States, Canada, Mexico, Great Britain, the United Kingdom, =
Kuwait, Dubai, Saudi Arabia, South Africa, Thailand, Indonesia, Egypt, =
Antarctica, Japan, China, New Zealand, France, Germany, Spain, Italy, =
Russia, Georgia, Brazil, Peru, Ecuador, Bolivia, Scotland, Ireland, =
Hawaii, Florida, Montana, Morocco, Israel, Iraq, Iran, India, Pakistan, =
Afghanistan, Mali, Bangkok, Greenland, Iceland, Cuba, Bahamas, Bermuda, =
Barbados, St Vincent, Grenada,, Virgin Islands, US, UK, GB, American and =
Canadian and Mexican and any of the 43 states with state tax returns, =
etc.
Alaska, Alabama, Arkansas, Arizona, California, Colorado, =
Connecticut, Delaware, District of Columbia, Florida, Georgia, =
Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, =
Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, =
Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, =
New Jersey, New Mexico,New York, North Carolina, North Dakota, Ohio, =
Oklahoma, Oregon. Pennsylvania, Rhode Island, South Carolina, South =
Dakota, Tennessee, Texas, Utah, Vermont, Virginia, West Virginia, =
Wisconsin, Wyoming, British Columbia, Alberta, Saskatchewan, Manitoba, =
Ontario, Quebec City, New Brunswick, Prince Edward Island, Nova Scotia, =
Newfoundland, Yukon and Northwest and Nunavit Territories, Mount =
Vernon, Eumenclaw, Coos Bay and Dallas Taxman and Tax Guru Your name =
has been added to our email list because of an enquiry we have received, =
we may not answer your question but=20
another similar question will be as we lump them.
You may find more answers at www.centa.com
David Ingram of the CEN-TA REALTY Group
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
108-100 Park Royal South
West Vancouver, BC, CANADA, V7T 1A2
(604) 980-0321 - Fax 913-9123 [email protected]
www.centa.com www.david-ingram.com
---------------------- multipart/alternative attachment
An HTML attachment was scrubbed...
URL: http://www.centa.com/CEN-TAPEDE/centapede/attachments/48ceb930/attachment.htm
---------------------- multipart/alternative attachment--
What's Related