Ask a cross-border International real estate rental mutual funds
immigration non-resident income tax expert - David Ingram 's CEN-TA Services
in North Vancouver BC Canada on It's Your Money CKBD AM600 Fred Snyder's
Radio Show
My_question_is: Applicable to both US and Canada
Subject: changing residency and citizenship status
Expert: taxman at centa.com
Date: Thursday December 23, 2004
Time: 01:00 PM -0800
QUESTION:
i was born in the U.S (michigan) but moved to canada at age 8 i am a U.S
Landed Immigrant living in canada(ontario) recently i was thinking about
moving back to the U.S to live im 28 yrs old now,i was wondering what steps
i would have to take to move back to the United States, and would i be able
to keep my Landed Immigrant Status, or become a dual citizen? in the event i
may want to come back to canada one day..because i was under the assumption
that once i move back to michigan i will lose everything and just be an
American Citizen again..with no status in Canada.My mother lives in canada
as well as my brother and my son. Thank you for Your Time
======================
david ingram replies:
THE GOOD NEWS:
BEFORE you move back to the US, get your Canadian Citizenship. You can
start the process on the Internet at
http://www.cic.gc.ca/english/citizen/index.html
Don't you dare go back to the US without getting your Canadian Citizenship.
Right now, it will take about 16 months to get it but that will leave you
free to move back and forth across the border at will later on.
THE BAD NEWS
You have to bring your US income tax returns up to date. We can do that for
you.
I need copies of your 1999, 2000, 2001, 2002, 2003 and now the 2004 Canadian
return.
I also need the Dec 31 2001, Dec 31 2002, Dec 31, 2003 and Dec 31, 2004 Year
end statements for any Canadian RRSP accounts you have.
AND, if you have more than $10,000 total in all your Canadian Financial
accounts, I need the name and address and the highest balance in the account
in 2004.
See the following answer to another question for more information. It has
the forms you need to fill out when leaving Canada.
A departing Canada return requires a T1161 and possibly a T1243 and T1244.
http://www.ccra-adrc.gc.ca/E/pbg/tf/t1161/t1161-03e.pdf
This is the form to calculate the tax on the T1161
http://www.ccra-adrc.gc.ca/E/pbg/tf/t1243/t1243-03b.pdf
This is the form that defers tax on the deemed disposition
http://www.ccra-adrc.gc.ca/E/pbg/tf/t1244/t1244-03b.pdf
Pro-rated exemptions, etc.
Take a look at the forms.
Your Canadian Accounts require TD F-90 forms and your RRSP's require special
reporting as well. We would start by filing an extension for the US return -
form 4868.
http://www.irs.gov/pub/irs-fill/f9022-1.pdf if this fillable form does not
work,
use
http://www.irs.gov/pub/irs-pdf/f9022-1.pdf
By non-resident status, I think you are referring to the USA. That would
be the last thing you would want because non-residents can NOT file a joint
return. The US joint return will save you thousands.
The first year is a toss-up. Most people would file you as a dual status
which also means no joint return. The only way to do it is both ways. To
file the joint return in the USA the first year, we have to add in all your
Canadian Income as well and claim a foreign tax credit. This almost always
results in significant US tax savings.
-----Original Message-----
From: David Ingram at home - bus at taxman at centa.com
[mailto:davidingram at shaw.ca]
Sent: March 31, 2004 11:19 AM
To: XXXXXXXXXXXXXXXXXX
Subject: South Carolina after moving from Ontario - - Gary Gauvin from
Rockwall and Garland Texas - ask an income tax expert experts specialist
specialists
----- Original Message -----
From:
To: 'David Ingram at home - bus at taxman at centa.com'
Sent: Tuesday, March 30, 2004 6:34 PM
Subject: RE: Question misdirected
Thanks David,
Here it is again:
Hi,
I just found your site yesterday and I'm excited at the resources you
provide. Generally we are do it yourselfer tax folks, but I think we may
need your services which we can discuss later as it is pretty complex.
Perhaps you could clarify something for us.
We live in Ontario and we are in the process of selling our house. We have
bought a house in South Carolina which will close in June. My wife is going
to go in on a TN visa as a Physiotherapist and I will go in as her spouse.
Later (in August) I will register with a student visa, so that I do not have
to renew it annually like my wife will. Now my wife will actually be working
in North Carolina as a physiotherapist and we will live (and I will go to
school) in South Carolina.
What are the tax implications of:
A) buying a house in the USA (S.C.) and then selling it after 3-4 years to
return to Canada.
B) working in one state (N.C.) and living in another?
Thanks in advance for considering our situation,
xxxxxxxxxxxxxxxxx
==============================================
david ingram replies;
If you buy a South Carolina, North Carolina. Arkansas or Georgia House and
live in it, any gains will be tax free up to $500,000 ($250,000 each) if you
have lived in it for 24 months out of the last 60 that you owned it.
If you lived in Hull, Quebec and worked in downtown Ottawa, you would file a
Quebec and a Canadian Federal return.
If you live in North Carolina and commute to South Carolina, you will be
filing a South and North Carolina return. You will not pay double state
taxes but you will end up paying the higher rate after exemptions, credits,
deductions, etc.
In your first year in the USA, you have the option of filing a joint tax
return by reporting your Canadian Income as well. This will save you tax.
Most preparers will suggest that you have to file a dual status return the
first year and can make it a joint return.
Whatever you do, have this year's returns prepared by someone who does both
(with experience - not at your learning expense).
There are a lot of us around although we are hard to find. There is a Steve
(don't know his last name because I misplaced it so this is an appeal for
the fellow who gave it to me to resend it) in Halifax and Gary Gauvin in
Rockwall, Texas www.garygauvin.com know what they are doing.
Gary was my partner in an office on Ottawa in the 80's and 90's.
We, of course, are all happy to help you by snail mail, email, fax or
courier, OR
Answers to this and other similar questions can be obtained free on Air
every Sunday morning.
Starting this Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of
Cartier Partners and I will be hosting an INFOMERCIAL but LIVE talk show
called "ITS YOUR MONEY"
Those outside of the Lower Mainland will be able to listen on the internet
at
www.600AM.com
This from ask an income tax immigration planning and bankruptcy expert
consultant guru or preparer 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 gambling refunds for
the United States, Canada, Mexico, Great Britain, the United Kingdom,
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Vincent, Grenada,, Virgin Islands, US, UK, GB, American and Canadian and
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US/Canada/Mexico Tax Immigration & 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
Bus (604) 980-0321
davidingram at shaw.ca
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Disclaimer: This question has been answered without detailed information or
consultation and is to be regarded only as general comment. Nothing in
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and all non-contractual duties are expressly denied. All readers should
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=========================================.
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