My_question_is: Applicable to both US and Canada
Subject: Canada/US dual citizenship...need accountant
Expert: taxman at centa.com
Date: Friday January 19, 2007
Time: 04:27 AM -0500
QUESTION:
Dear Sir:
I immigrated from Canada to the US in 1989. I obtained US citizenship in
2000. I returned to Canada in Sept. 2004. I am still here and am intending
to remain here in BC.
I put my life savings in a variable annuity in the US in 2003 and
bought a condo in Oregon in 2003 which is now a rental. I have CPP
including widowers pension, and American SS, and will have OAS starting in
Feb 2007. That's all. I have no Canadian real property, no private
pensions, no RRSP or US equivilant.
I filed tax returns for both countries for 2005 and was surprised to
see that I paid no taxes to either country. (I had paid over 2000 to the US
in 2004.) Apparently my rental property passive losses and my low draw from
my annuity that year, were the reason?
Xxxxxxx in Kelowna, prepared both returns for me. He says he can not
do it for 2006 due to lack of help, and he is looking for someone in
Vancouver for me right now.
So I need an accountant, but I also need advise (which I never seem to
get.) Examples:
1. Should I renounce my US citizenship? I was going to keep it in case I
need to live with my son in the US when I become very old and unable to care
for myself. Is that a valid reason to keep dual citizenship?
2. Should I sell the condo. I was going to keep it because I bought it in
2003 with 10% down and 4 3/4 % mort. for 30 years that cant be increased
every 5 years like in Canada. It's gone up 50,000.
3. Should I switch my variable annuity investment to Canadian investments.
I was going to keep it because I thought that the US would charge me a huge
capital gains tax if I switch it. It's gone up 125,000.
4. Am I better off financially to live in Canada? (I qualify for US
medicare)
How much would you charge to do my 2006 taxes? (I've told you everything
and there have been no changes in my situation since last year.)
Well, I moved money between funds within the annuity but hopefully that
doesn't trigger any taxes.
And I spent a week in the US (Hawaii) in 2006...nothing in 2005.
Thanks, and thanks for your web site.
--------------------------------------------
david ingram replies:
In pure dollars, you are likely better off to live in Wenatchee than Kelowna
or Bellingham than Vancouver.
What you are looking for is what I/we do.
goto www.centa.com and read:
1. US/Canada Taxation in second box down on right hand side.
2. Oct 1995 Newsletter in top left hand box
3. Oct 1993 Newsletter in top left hand box
------------
a sample pricing guideline follows:
Phone consultations are $400 for 15 minutes to 50 minutes (professional
hour). Please note that GST is added if product remains in Canada or a phone
consultation is in Canada.
This is not intended to be definitive but in general I am quoting $800 to
$2,400 for a dual country tax return.
$800 would be one T4 slip one W2 slip one or two interest slips and you
lived in one country only - no self employment or rentals or capital gains -
you did not move into or out of the country in this year.
$1,000 would be the same with one rental
$1,200 would be the same with one business no rental
$1,200 would be the minimum with a move in or out of the country. These are
complicated because of the back and forth foreign tax credits. - The IRS
says a foreign tax credit takes 1 hour and 53 minutes.
$1,500 would be the minimum with a rental or two in the country you do not
live in or a rental and a business and foreign tax credits no move in or
out
$2,400 would be all of the above and you moved in and out of the country.
This is just a guideline for US / Canadian returns
We will still prepare Canadian only (lives in Canada, no US connection
period) with two or three slips and no capital gains, etc. for $150.00 up.
With a Rental for $350
A Business for $350 - Rental and business likely $450
And an American only (lives in the US with no Canadian income or filing
period) with about the same things in the same range with a little bit more
if there is a state return.
Moving in or out of the country or part year earnings in the US will ALWAYS
be $800 and up.
TDF 90-22.1 forms are $50 for the first and $25.00 each after that when part
of a tax return.
8891 forms are generally $50.00 to $100.00 each.
18 RRSPs would be $900.00 - (maybe amalgamate a couple)
Capital gains *sales) are likely $50.00 for the first and $20.00 each after
that.
Just a guideline not etched in stone.
--------------------------------------
David Ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
My Home office is at:
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 9 PM 7 days a week Vancouver (LA) time -
(please do not fax or phone outside of those hours as this is a home office)
email to taxman at centa.com <mailto:taxman at centa.com>
www.centa.com <http://www.centa.com/> www.david-ingram.com
<http://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 and the author and any
and all non-contractual duties are expressly denied. All readers should
obtain formal advice from a competent and appropriately qualified legal
practitioner or tax specialist for expert help, assistance, preparation, or
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