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Having cabin or trailer in US (Maple Falls Washington to be exact) 

QUESTION: Hello David,

I'm living in Vancouver, finally paid off the student debt but don't see myself getting into 
the expensive Vancouver market. I do however like to ski and was thinking of buying an 
inexpensive trailer (25k Cdn) in Maple Falls Washington. 
 
However I'm not sure what other expensives I should expect given that it's in the US. 
I'm not trying to make this an investment with a high return, but I would like to do some 
handy work to it to increase the value. If I add about 10k worth of value, how would that 
affect my taxes in the long term?

Thanks for the advice.
----------------------------------------------
david ingram replies:

One of my favourite weekends ever was in 1973 at the Chandelier (think it has a different name now) when marooned at SnowLine  because of the gas shortage when one could only buy gas on odd days if your licence pklatre ende dwith an odd number and even days when it was an even number.

Strangely, it was that weekend 34 years ago that lets me answer you question now.

The cabin I was staying in was not a rental but was built by the fellow who owned it.  When he was building it, buddies would come down and help him and one weekend, the INS raided the spot and deported a bunch of his friends for working in the US .

He was fine building it because he owned it but no one else can hammer a nail, paint a board, install a sink, or carry a shingle if they are not either an owner or a legal US citizen or US resident with a green card.

If your buddy is working and living inthe US with a TN, H1, O1, P1, L1 or any other visa but a green card, they cam NOT help you either.

And, if you are intending to rent the trailer out 'EVER', 'you' can NOT hammer a nail, sweep the front steps or clean the toilet.


Assuming you are buying this trailer on its own lot, when you go to sell, you will owe the US income tax on the profit.

If it is your only pioece of real estate at that time, you will not owe Canada any tax because you can claim it as your personal residence if you have not bought another place.
-------------------
However, I would far prefer that you stretched your resources to buy something in Canada to live in and combine your present rent and the payments you would have to make for the trailer to buy your home in Canada. If you can't afford a one bedroom, buy a studio.  Go down to Ikea onteh Lougheed highway and look at how much they can put into a small space.  

Interestingly, I read the other day that Ikea has now sold enough furniture in North america that 10% of all children are conceived in an Ikea Bed.  Now that is information worth knowing.

Good luck

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Non-resident taxes process and taxes in Montreal

QUESTION:

Hi,

I am a US citizen living in New York, who purchased an investment home in Montreal in 2002. The home has been rented out, but has never made a profit any year (due to mortgage, depreciation, expenses, etc.). I am just being notified of the new non-resident tax situation (form NR6) that I need to abide by.

I understand I need to find an agent to help handle pass years non-resident income taxes and current/future non-resident income taxes.  If the property has never realized a profit, how would recommend I procede. Should i secure an accountant to act as my agent to handle all past/current/future non-resident taxes?

--------------------------------
david ingram replies:

There is nothing new about the NR-6.  I do not know when it was brought into play but iIhave been filling them in since the late 70's and the following was printed in my 1989 book.



RENTAL PROPERTIES - CANADA - OWNED BY U.S. RESIDENT


More important perhaps is the problem with rental properties in Canada. When owned by a non-resident, they are subject to a 25% withholding (or 15% if living in Bangladesh) tax. If the renter does not pay this tax,  the government can come along two or three or 15 years later and demand the tax.

Imagine the consternation of a tenant of a house in the British Properties in West Vancouver, or Rosedale in Toronto. Assume the tenant has been paying $2,000 a month for a $500,000 house owned by a Hong Kong resident. After three years of paying $24,000 a year to the `non-resident', they finally buy a house and move. Two months later, there is a knock on the door and a National Revenue representative is standing there demanding 25% of $72,000 for NON-RESIDENT withholding tax (this is a true story by the way, only the owner was in London).

There is a way around this problem. The tenant can ask to see, or rather DEMAND to see a copy of the landlord's filed and accepted NR6 form. (See forms in back of book). This form allows the tenant or agent of the landlord to deduct a lesser amount (or nil if a loss) than 25% of the gross rent. It allows for expenses to be taken off and the tax can then be withheld at 25% of the net, rather than the gross. The property management division of david ingram & Associates Realty Inc. files about 300 of these NR6 forms a year. (This is only necessary if you are paying directly to a landlord whom you KNOW to be a non-resident of Canada.  If you are paying to an agent or Canadian Resident, you are okay.)

Please note, the NR6 MUST BE FILED BEFORE the first rent cheque is received or 25% of the gross rent must be remitted. For years, we were in the habit of filing `this years' NR6 late with last years tax return. In 1989, National Revenue stopped accepting this sloppy practice and demanded them on time.

IF YOU SIGN THIS FORM AS AN AGENT, AND THE OWNER DOES NOT FILE HIS OR HER RETURN BY JUNE 30TH OF THE FOLLOWING YEAR, YOU, THE AGENT, ARE RESPONSIBLE FOR THE 30% OF THE GROSS RENT WITH NO REFUND PROVISIONS FOR ANYONE.

RENTAL PROPERTIES - UNITED STATES - OWNED BY A CANADIAN


If paying 25% of the GROSS rent to Canada sounds bad, cheer up. The United States taxes the Canadian 30% in the same situation. To avoid this, the Canadian needs to notify the U.S. Government that he wishes to be taxed as a business rental house on the "net income" received. But if you do not notify the IRS in advance, the IRS CAN tax you at the 30% of gross rate.

-------------------------------------
What you have to do is get the 2002 to 2006 returns in as soon as possible or be prepared to pay 25% of your gross rent as tax plus penalties and interest if the CRA catches you (remember the US IRS charges 30% in the same circumstances).

Get someone to prepare the returns.  If you would like us to do them for you, that is what we do.  Then get your NR-6 in with a Canadian resident signing as an agent.  You might even try making your tenant the agent.  Remember, if you file the NR-6, you can claim your rental expenses and 25% is only withheld on a profit if any.  Therefore, if the gross rent was $1,000 and the expenses were $900, the agent only has to remit $25.00 a month.

If there is a loss on a monthly basis, no tax has to be remitted.

Just remember, it is NOT the amount of the mortgage payment that is deductible.  Only the interest portion is dedcutible so it is possible to be out of pocket each month becasue of the principal portion of the rental payments, but stillowe tax.

When the actual return is prepared, you can use depreciation to reduce any profit to zero and you will get baxck any tax that was dedcuted.

Also remember, that the figures have to be converted to US dollars and put on a schedule E of your 1040.  This will usually result in a refund on your US and New York 201 returns.

We can prepare the Canadian and US return amendments if necessary

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Capital Gains on house they built - section 45(3)

QUESTION:

Thanks for taking my email.
Owned the  property for 25 years, 1982-present.
Started to build house in 1988, and finished in 1992. We moved into the house in 1992. I claimed personal residence on the previous house up to  1992.
Is this what Revenue Canada wants?
Selling price $920,000.00.
Cost to build house $463,232.00.
50% of gain is $231,616.00.
$231,616.00 divided by 25 years = $9264.64.
$9264.64 X the 10 years we were not there equals $92,646.40 gain divided between two owners equals $46323.20. Assuming a tax rate of 16.6% we would both owe $7,689.65.
Would this be correct?
If so, can we write off any of the expenses up to the day we moved in? eg. Property Taxes.

Thanks very much

---------------------------
david ingram replies:

This house was never rented and represents a lot purchase plus th cost of building a house.

If i had been involved back in 1992, I would have reported any profit on the property up to the day you moved in, reported it on line 127 and then exempted it on line 256 under Section 45(30 of the tax act.  I wouol dthen claim all the profit from teh day you moved in as my principal residence and pay tax on the profit from 1982 to 1992.

This is a much better calculation than what you have proposed which is the essential calculation you would end up with after filling in form T2091. 

The following are similar replies as well.
My question is: Canadian-specific

QUESTION: Hi David,

I am a Canadian citizen. However, from March 2000 to Nov 2004, my family and I became non residents while I worked overseas. During the period that we were overseas we rented our home in a long term lease agreement. When we returned to reside in Canada we purchased another home to live in and we have continued to rent our original house. Could you please explain how capital gains will be handled? Do we need to file anything forms with CRA prior to selling the rental house? Also, how would capital gains be handled if we sell our current personal residence and move back into the rental house?

Best regards,

________________________________________________________________
david ingram replies:

The first house has incurred capital gains tax from the moment you left the country.  Although it is possible to rent a house out for 4 years and claim it capital gains tax free by filing an election under section 45(2), this does NOT apply to non-residents.  We have had a couple of cases lately where the capital gains tax on the house is more than the tax saved bt becoming a non-resident for three or four years because the houses went up so much in value.

I am assuming here that the second house you are living in has increased in value more than the rental since you returned and it should be your principal residence for that time because it would have been possible to declare the rental capital gains tax free after your return by filing the election.

Deemed Disposition!

Moving in to a rental house 'triggers' the capital gains right now although it does not have to be paid right now. The capital gains is calculated on schedule 3 and the amount put on line 127 of the T1 General Canadian Tax return.  You then make an election to defer payimng the tax until actual sale under section 45(3) and deduct the line 127 amount on line 256.

This older question will likely help you understand it.


QUESTION:

We have moved out of country for job reasons and now look to return to
Canada.  Before leaving we tried to sell  our home and were unable.  For the
last 10 years we have been renting it.  We plan to move back into and then
sell it.  What must we do in order to avoid paying capital gains tax.

Dan

PS  We did not know that we could have declared it our principal residence
as we moved for job reasons and thus, did not do that!
====================================================================
david ingram replies:

When you moved out of Canada, you should have done a departing Canada return
and filled in either a T1161 or the former form (number escapes me a t ithe
moment) to declare assets left behind.

At any rate, if you became a non-resident of Canada from your job move,
there is no exemption from capital gains tax on the increased value of the
house unless you were a deemed or factual resident of Canada while you were
gone.  A deemed or factual resident status can apply to people who are
working on CIDA projects, are members of the armed forces, are members of a
Canadian Diplomatic mission, working for the United Nations and a couple of
other esoteric items covered by Regulation 3400.

Your Belgian email address makes most of these possibilities unlikely.

In addition, you would have had to report your earned income to Canada every
year and I presume that you did not do that but did file a Section 216(4)
rental return to report the rent received.

A further complication is that if you returned to Canada and bought another
house which you moved into, there would not be an immediate tax bill but if
you move into the rental house, it is deemed to have been sold and you (and
your spouse if joint) owe tax on the increased value.

Fortunately, under section 45(3) of the Canadian Income tax act, you can
notify the CRA (Revenue Canada when you left 10 years ago) that:  I hereby
elect under section 45(3) of the Income Tax Act to defer the payment of tax
on the residence at XXX your street, until the actual sale.  Attach a
proforma Schedule 3 to calculate the profit and then pay it when you
actually sell the house.

In other words, if your intention was to move in for a short time to try and
make it tax free, you are just doubling your moving expenses and increasing
your accounting and legal fees.

If the idea is to move into a new house on your return, you are better off
to sell the one you have first and buy the new one
before you come back so that you have the most capital freed up to buy the
next house and move directly.

-  Incidentally - If you decided to keep the old one as a rental and borrow
money against it to use to purchase the new one, the interest on the
borrowed money is NOT deductible against the rental income even though the
mortgage is registered against the rental house because the money was USED
to buy the personal residence you are about to occupy.

You can learn more about this by reading CRA Bulletin IT-533 at:
http://www.cra-arc.gc.ca/E/pub/tp/it533/it533-e.pdf

You can find out more about interest as a deduction by reading my November
2001 newsletter by going to www.centa.com, clicking on newsletters in the
top left box, click on 2001 and click on November. �

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Can you do a 1031 exchage between Canada and the US. NO!

My question is: Applicable to both US and Canada

QUESTION: If my wife and I purchase a property (Tennent in common) in Victoria B.C. can we do a 1031 exchange from the sale of a commercial building in the U.S.? Thanks for your help.

-------------------------------------------------------- david ingram replies:

No -  You can do a 1031 exchange between two Canadian properties or two US properties or two Mexican properties but not between a US and Canadian property.

However, 'If' the time comes when you might consider selling the Canadian property and buying another Canadian property, do NOT even think of a 1031 exchange.  Canada does not recognize it and you would owe Canada Tax.  You should pay the Canadian tax and claim it as a foreign tax credit on schedule 1116 of your US return at the time. That will increase your ACB (adjusted cost base) for the future.

Remember you need to fill in Form NR-6 BEFORE the first rent and have a Canadian Resident sign it for you.  See another Q & A that will be coming withim 24 hours dealing with this. �

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Canadian/US tax filing assistance

Hi,

My husband and I are in need of Canadian/US tax assistance and advice. We had been living and working in the US, under J1 andJ2 visas respectively, for 2 years until August 2006, and we haven't yet completed or submitted our US or Canadian 2006 taxes.

Also, my husband has not filed Canadian taxes for 2004 (Jan-August). This will have to be done.

We have both filed US taxes for 2005.

Question 1 - We haven't filed Canadian taxes for 2005, since we were living and working in the US for the entire year. - do we have to?
Question 2 - I know that there is a question of residency, and this is where I am having some difficulty - the language in the resarch I have done is tricky and difficult to interpret. I think that since we were living and working in the US from September 2004 until August 2006, that we were residents of the US and so should only file/pay taxes in the US for that period. Is this true? We don't want to have to pay taxes twice!

We have all of the forms and documentation, but they need to be filled out correctly and filed.

Is this something that someone in your office can help us with? If so, can we make an appointment to meet at your convenience? And if not, can you point us in the right direction? Any help would be greatly appreciated.

We are also interested in longer-term tax/financial advice. Is this something that you offer as well?

Thank you.
---------------------------------------------------------------------------
david ingram replies:

Your situation represents our typical client rather than the occassional one which most accountant / tax advisors would encounter.

I would be happy to see you and prepare the paperwork necessary.

You do not have to file for 2005 but likley should to stop the computer asking for it anyway when you are still filing for 2004 and 2005.  There would not be any tax on the 2005 because any US income would be exempted under article IV of the US Canada Tax treaty.

The 2004 should likely have had form T1161 filed and it needs to be explored because a late form is a $2,500 fine.

My experience is that the CRA fines the 42,500 if the form is filed late but has not yet fined anyone for not filing it  (Is there a message there) in my experience.

Call Gillian Bryan between 10:30 AM and 4 PM at (604) 980-0321 to set up an appointment to have teh 2004 Cdn and 2006 US (state) and Canadian returns prepared.

You should bring in your 2004 US return as well as I can almost guarantee that it will be  deficient if prepared by a US accountant who does not specialize in people moving into the country. �

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buying mother's house 

My question is: Canadian-specific

QUESTION: I have a house that is my primary residence in GTA.  I am thinking of buying my mother's home in Ottawa and looking to move there in the next year or two.  I am thinking of buying it now, and she would live there, paying rent for the next year or two.  When I sell my house in the GTA and move to the house in Ottawa will I have to pay Capital Gains Tax.  Also is there a minimum rent I need to charge her.
---------------------------------------------------------------------------
david ingram replies:

If you own two houses at the same time, you will capital gains tax on one of them if they both go up ion value,.  Better to leave the Ottawa house in mother's name until  you buy it.

Better still, buy a different house and leave mom in her tax free house or at least make sure (if you do buy  out her house) that she buys her retirement condo and does not just go and rent somewhere else.

There is no minimum or maximum retn you have to charge your mother but you can NOT claim rental losses as a dedcution on your return when rented to your mother, sister, brother, father, kids, etc. 

(An exception would be where you own a condo in a building of retnal condos and you are renting it to mother for the exact market rent that all the others are rented for.  If that was the case, a rental loss on your return could be claimed.)

Of course, you aren't supposed to charge your mother rent anyway.  She didn''t charge you for room 'and' board for the first 16 to 25 years of your life. �

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Follow up: entering usa to work as caregiver for Canadian Family on vacation

Temporary Resident Visa Exemptions: Immigration Regulation 190(3)(f):
Visa exemption - purpose of entry - A foreign national does not require
a temporary resident visa f they are seeking to enter and remain in
Canada solely to re-enter Canada following a visit solely to the United
States or St. pierre and Miquelon, if they (i) held a study permit or
work permit that was issued before they left Canada on such a visit or
were authorized to enter and remain in Canada as a temporary resident,
and (ii) return to Canada by the end of the period initially authorized
for their stay or any extension to it.

This allows the Philippine national Live-in Caregiver to return to
Canada if she's only temporarily enterring the United States.

You're correct in that she'd have to secure entry to the US through the
US Consulate.

Hope that helps..

Regards,
Ron McKay
CSIC Membership Number M041205
Immigration Consultant

-----Original Message-----
On Behalf Of
US / Canada Income Tax Help - CEN-TAPEDE
Sent: Sunday, July 29, 2007 12:16 AM

Subject: US USA / CANADA Income Tax Help - entering usa to work as
caregiver for Canadian Family on vacation - David Ingram gives expert
income tax & immigration help to non-resident Americans & Canadians from
New York to California to Mexico family, estate, incom

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Sponsoring Lebanese wife from Kuwait to live in Vancouver - Canada

QUESTION: I am Canadian, I've been living in Kuwait for the last 12 years, I'm married to a Lebanese lady 
and our 2 kids are Canadian. We are planning to leave Kuwait and move back to BC-Vancouver, We own a saving of 20,000 CD, 
and we are planning to use this amount for a place rental, furniture and kids school fees. 
My question, should I have to pay any taxes for that amount of money, and in case we run out of money, 
can I immediately apply to receive a social aid (Pension) until I find a job? In addition, what are the 
fastest and easiest procedures to follow to sponsor my wife so that she can live with me in Canada? 
---------------------------------------------------------------------------
david ingram replies:

The $20,000 should not be taxable if earned out of the country.

If you run out of money, you should be able to apply for social assistance wherever you live in Canada.

When you get here, you and your wife should apply immediately for the Canada Child  Benefits - You can find the details at:
 http://www.cra-arc.gc.ca/E/pub/tg/t4114/t4114-07e.pdf


You will have to sponsor her using the following forms.

You can start the process by going to:
1.    http://www.cic.gc.ca/english/pdf/kits/guides/3910e.pdf
This is a guide for sponsoring a US citizen spouse into Canada.
           Publication 3910E 

1a)   http://www.cic.gc.ca/english/pdf/kits/guides/3911e.pdf
This is the guide for sponsoring a person from Kuwait or Lebanon
            Publication 3911E
 
2.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM1344EA.pdf
This is the application form to sponsor - form IMM-1344A

3.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM1344EB.pdf
This is the sponsorship agreement - Form IMM-1344B

4.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5481E.PDF
This is the Sponsorship Evaluation Form IMM-5481

5.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5409E.PDF
This is a statutory declaration of a common-law marriage - FORM IMM-5409

6.   http://www.cic.gc.ca/english/pdf/kits/forms/IMM5540E.PDF
This is the Sponsor Questionnaire - Form IMM-5540

7.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5540E.PDF
This is an authority to release information - FORM IMM-5540

8.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5491E.PDF
This is a document Checklist - Form IMM-5491

9.    http://www.canadapost.ca/tools/docp/CIC/bin/hpm-e.asp
This is where you order your official receipt

10.    http://www.cic.gc.ca/english/pdf/kits/forms/imm0008egen.pdf
This is your actual Application for Permanent Residence - FORM IMM-0008GEN

11.    http://www.cic.gc.ca/english/pdf/kits/forms/imm0008_1e.pdf
This is your Background Declaration - FORM IMM-008_1

12.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5406E.PDF
This is your additional family information - FORM IMM-5406

13.    http://www.cic.gc.ca/english/pdf/kits/forms/IMM5490E.PDF
This is your spouse or conjugal partner questionnaire -= FORM IMM-5490

14.    The Above PLUS a police report from your local police station (See
the guide for details) applies to those being sponsored from the UNITED
STATES. There is a separate brochure for every country.  If you are reading
this and are from any other country (Australia, Brunei, Austria, Venezuela,
etc) goto

14a   http://www.cic.gc.ca/english/applications/fc.html for other country
guides.

15.   http://www.cic.gc.ca/english/skilled/assess/index.html
This is the self-assessment test for an individual to determine his or her
eligibility to immigrate to Canada without being sponsored by a spouse.

Hope this helps-

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Canadian consultant working in US with TN under contract

Hello,

I am self-employed (incorporated business) and work under contract for a US consulting firm. I am NOT an employee, but my contract is long-term and exclusive.

I work 4 days a week in the US (Illinois) on a consulting project (at a client's site) on a TN visa. I have been doing this since September, 2006 (my incorporated business' fiscal year ends in Sept 2007).

Do I need to pay US taxes even though I live in Canada and my business is based there?
I am in the US less than 186 days a year.

What if I work in multiple states?

Thanks,

-------------------------------------------------
david ingram replies:

If you have an actual long term conttract and are working under a TN visa, you are illegal and can have your TN revoked by any single Homeland security officer at the border.

Therefore, if you realy have a long term contract, the border person can revoke your TN and ban you from the US for 5 or 10 years under ER (Expedited Removal)  for filing false documentation to get your TN visa.

The terms of a TN visa are very clear that the contract is a short term contract lasting a year or less although it can be renewed for an indefinite time. This is the risk that all TN holders take.  Your contract is for a year or less and you have to be prepared for an employer's not offering you anopther letter at the end of the year.  If they do not, you can't sue because you would be proving in court that the two of you violated USCIS rules and could both be severely punished. Although you do not need to be paid on a strict W2 basis with tax, medicare and FICA deducted, you can opmnly to work for the employer who sponsored your visa.  Anything earned in the USA is absolutely taxable as an employee in the USA unless you earn less than $10,000 under Article XV of the US / Canada tax treaty.  However, that article does NOT exempt you from Illinois state tax.  AND, you must file your Federal 1040NR witjh foprm 8833 in that case to claim the exemption.

You are taxable in both Illinois and the US because you ware working there at a fixed base.  If you were working all over all of the time, it would not be a fixed base but 4 days a week at the same site most of the time is clearly a fixe base of operations and your TN visa is for you NOT your Incorporated Canadian Company which is likely a waste of time and accounting and legal  fees under the circumstances. 

You should have filed a US 1040NR and an Illinois IL-1040 with schedule NR for 2006.  Any tax you owed on these two tax returns would be a foreign tax credit on your Canadian tax return by filling inform T2209  lines 431 and 433 on schedule 1 of the Federal return and form T2036 and line 47 47 of the Provincial form 428.

If you were working all over the place and not at the same place in your employer's premises on a three or four day a week basis, you could be exempt from US federal tax under Article XIV of the US / Canada Income Tax treaty. However, you stated you were at the client's sitre for 4 days a week and that qualifies as a fixed base of operations.

Your Visa is for 'YOU' to work for whatever the name of the employer comapny in the US is.  It is NOT for you to work for a Canadian Company that you happen to own.  In fact, you can NOT officially get a TN visa for a company that you own.  (I say this a little tongue in cheek becasue I have seen them issued many times but the paperwork never indicates that the visa holder owned the company).

Remember that the US has a Subchapter S corporation where the fees just flow through to the owners of the company and that is how you should be treating your earnings in the US.  If you are working in multiple states, then properly, a separate return should be filed for each state.  Now, you might talk to another dozen tax consultants who tell you that you do not have to file in the US (I think you already have)  but I assure you that they are incorrect as you have described your situation. Even if you were exempt from tax because of Article XIV or Article XV, you STILL HAVE TO FILE THE RETURN WITH FORM 8833 to calim the exemption and that exemption does NOT apply to the state.

And, yes, I know of people who are doing what you are doing and have not yet been caught by the US IRS. or Homeland Security.  I also know of dozens who have been caught and paid BIG penalties and interest bills to the IRS when the situation catches up to them and been banned from the US for five or ten years for filing false working visa papers.

The following are the first rules for a TN visa



CHECK LIST for the TN Visa


    * An applicant for admission must establish Canadian citizenship

    * The applicant must be entering the United States to engage in a profession or occupation at a professional level under NAFTA

    * The applicant must be in possession of an offer or contract of employment from a United States employer stating:

        1)     The professional activity to be engaged in

        2)     Purpose of entry 

        3)     Remuneration

        4)     That the position is temporary in nature and will not exceed one  year  (although it can be renewed)

* The applicant must provide documentation of his or her educational degree or professional qualifications

* The applicant must meet all licensing requirements

* Employment need not be full-time 

* Permanent residence abroad is not a prerequisite

* Maximum period of admission of a TN is one year

* TN dependants accompanying the principal TN will be admitted under the  "TD" classification for the same amount of time as the principal 

* A $56 U.S. fee is required ($85.00 for renewal by mail)

* TN applicants are not permitted to enter as a professional to participate in any way to circumvent a strike

* SELF EMPLOYMENT IS NOT PERMISSIBLE - This means you can NOT set up an office and take multiple clients.  You 'can' be paid on a 1099 basis which means that you are responsible for both sides of the 16% Social Security taxes.  If there is more than one US employer who wants your services, you can obtain an individual TN visa for each one.  In fact, if you show up at the border with six legitimate job offers for a day a week each (as an example) you can get all six TN visas at the same time for one fee.




The following is a partial list of some who qualify under a TN Visa. Please note that extensive experience can equal a degree in many cases. All need a Bachelor or Baccalaureate degree unless otherwise noted. In some cases, 3 or 4  years of practical work in a discipline can count for one year of a University degree.  Therefore if the University BA requires 3 years, you need 9 or 12 years of work experience to qualify.


* Accountants - RIA or SIA or CPA or CGA or CMA or CA

** Actuaries (this is one of two classifications added since 1989)

* Agriculturalists

* Agronomists

* Animal Breeders

* Animal Scientists

* Apiculturist

* Architects - BA or state / provincial license

* Astronomers

* Biochemists

* Biologists

* Botanists

* Chemists

* Computer Systems Analyst - BA or Post-secondary Diploma or Post-secondary certificate and three years of practical experience. This does not get you to the USA, if your job is programming a computer.  An Analyst might spend a day a month working on some modifications (in a testing mode for instance), but they better not be thought of as a "programmer" within the company.


**** Computer Software Engineer *** This is NOT here as an approved occupation.  However, Jackie Bednarz (US head of the NAFTA Section 16 Working group in Washington stated specifically that if a recognized University was to offer the degree, she would consider computer software engineers under the ENGINEER classification when a recognized University granted the degree.  My understanding is that SFU and McGill are now granting such degrees and that the Professional Engineers of British Columbia have recognized graduates as members of their professional society.  Note that TC and TN's were being granted for this category on a sporadic basis until the INS realized that no such "official" degree existed. 

Jackie Bednarz also pointed out (She was part of the original negotiating team when the original FTA (Free Trade Agreement) was being negotiated in 1985, 86, 87 and 88, there was no such thing as the INTERNET, "web masters" and "web sites". When negotiating the job titles, no thought was given to the computer revolution, other than the computer system analyst designation, which at the time meant a main frame analyst for a $1,000,000 computer.

(Thanks to Stuart Lynne and Richard Pitt) (www.fireplug.net), the CEN-TA Group was an official member of the internet as far back as 1986 and thanks to Bill Gates himself (he told me to use Microsoft Xenix as my operating system) and Radio Shack Model 16 computers, CEN-TA was using "email" between offices in Toronto, Ottawa and Vancouver as early as 1983. 

As another aside, Stuart Lynne and Richard Pitt went on to found WIMSEY, the FIRST ISP in CANADA. Bill Gates became quite famous as well. 



* Dairy Scientists 

* Dentists - DDS, DMD, or state / provincial license

* Dental Technicians

* Dietitian

* Disaster Relief Insurance Claim Specialists - (claims adjuster employed by an insurance company located in the territory of a party or an independent claims adjuster) - BA and successful completion of training in the appropriate areas of insurance adjustment pertaining to disaster relief claims; or, three years experience in claims adjustment and successful completion of training in the appropriate areas of insurance adjustment pertaining to disaster relief claims

* Doctors - (see physician further on)

* Economists

* Engineers - BA or state / provincial licensing

* Entomologists 

* Epidemiologists

* Forester - BA or state / provincial licensing

* Geneticists

* Geochemist 

* Geologist 

* Geophysicists  (including Oceanographer in the United States)  

* Graphic Designer - BA or post-secondary diploma and three years    experience.

* Hotel Managers - BA in hotel / restaurant management; or,       post-secondary diploma or post-secondary certificate in hotel / restaurant management and three years experience in hotel / restaurant management

* Horticulturist

* Industrial Designer - BA or post-secondary diploma or post-secondary certificate and three years experience

* Interior Designer - BA or post-secondary diploma or post-secondary certificate and three years experience

* Journalist BA plus three years experience - (This category is no longer valid and has been left in to explain the circumstances. As I understand it, journalists in general took it as an insult that they had to have a BA degree, because, "most, if not all," of the best known journalists do not have a BA degree.)

* Land Surveyor - BA or state / provincial licenses

* Landscape Architect

* Lawyer (including notary in the Province of Quebec) - LLB, JD, LLL, BCL degree (five years); or membership in a state or provincial bar

* Librarians - MLS or BLS (for which another BA was a prerequisite)


* Management Consultants - BA; or equivalent professional experience as established by statement or professional credential attesting to five years experience as a management consultant, or five years experience in a field of specialty relating to the consulting agreement.  I must make it clear here.  A Management Consultant is NOT a manager.  The surest way to lose your management consultant renewal is to show up at the border with a business card with the title General Manager, Western Region, or Human Resources Manager, or, or, or.  A management consultant could consult with the actual sales manager about sales techniques or about selling into Canada.  A management consultant could be advising the actual human resources manager in hiring techniques or even suggesting that one candidate is a better fit than another one.  A management consultant can do market research, gather and assemble data and write a report to give to the manager. This is likely the hardest TN visa to get but is also a very important one when it comes to serving the needs of the US company.

Note that the management consultant does NOT need a degree, just five years experience.  This is the perfect job description for the person with 23 years of job experience who has never gone through the formal process of getting a university degree in the discipline.

* Mathematician (including statistician)

* Medical Laboratory Technologist (Canada) / Medical Technologist (U.S.) - BA; or post-secondary diploma or post-secondary certificate and three years experience

* Meteorologist

* Nutritionist

* Occupational Therapist - BA; or state / provincial license

* Organic Chemist  

* Pharmacologist (Pharmacist) - BA; or state / provincial license

* Physician - (teaching or research only), MD or state /provincial license. To work as MD, a doctor must pass his MLE (medical licensing exam), which has three, parts written over a year.  After passing, he or she would enter the U.S. under an H-1A.

* Physicist (including oceanographer in Canada)

* Physiotherapist/Physical Therapist - BA; or state     /provincial license

* Plant Breeder

** Plant Pathologists (This is one of two professions added since 1989)  

* Poultry Scientist

* Professional (most recognized professions)

* Psychologists - state / provincial license

* Range Conservationist

* Recreational Therapist

* Registered Nurse - state / provincial license

* Research Assistant (working in  post-secondary educational institution)


- * Scientific Technician - Possession of: (a) theoretical knowledge of any of the disciplines: agricultural sciences, astronomy, biology, chemistry, engineering, forestry, geology, geophysics, meteorology, or physics; and (b) the ability to solve practical problems in any of those disciplines, or the ability to apply principles of any of those disciplines to basic or applied research.

* Social Worker

* Soil Scientist

* Sylviculturist

* Teacher (College, Seminary, or University) (Post Secondary level only)

* Technical Publication Writer - BA, or post-secondary diploma or post-secondary certificate, and three years experience

* Urban Planner (including geographer)

* Veterinarian

* Vocational Counselor

* Zoologist



SUBJECT TO CHANGE


This list is subject to change at any time. When talking to Dennis Olsen about updating the rules, I mentioned a nurse who had found out that nurses could go south instantly in the late 1970's.  She got a job offer from a Hawaii hospital, came back to Vancouver, quit her job, sold her house, kicked out her husband, gave away the dogs and showed up at the airport to move to Hawaii, only to find out that they had closed the quota for nurses.

And then, as I was writing this exact section of the book in March, 1995, I received a call from a Doctor who had a job offer from the U.S., sold his house and Canadian practice, only to be told that he did not qualify when he showed up at the border because although a practicing family physician in Canada and fully qualified to go south with a Green Card (a resident alien immigrant visa), he did not qualify as a TN (can only teach or do research) and he did not qualify as an H-1B because he had not written an MLE. This medical licensing exam is written in three stages over a one year timetable.  I guess he has to sue his immigration attorney in Los Angeles.  This attorney knew he did not have his MLE, but charged him significant monies and told him he could get in now!

Remember, NONE of the foregoing confers permanent status. For permanent status, you must still stand in some sort of line.  However, it seems to be true that if you are in the U.S. as a TN or as a L-1, your line moves much faster than if you start from out of the country.



W A R N I N G
March 8, 1995 - When a Canadian leaves Canada to move to the U.S., there is a departure tax.  This means that all of the Canadian's assets are deemed "to have been sold" at fair market value the day before he or she leaves. If there are "paper profits," tax is due on this paper profit although a bond may be posted. The United States did not have this departure tax because the U.S. citizen has to keep on filing U.S. FEDERAL INCOME TAX RETURNS while out of the country for as long as they remain a U.S. citizen. If they gave up their citizenship, they could own a million dollars worth of assets that they had paid a dollar for and their "paper profit" would have just disappeared into the mist. Section 352 of the new Legal Immigrant and Illegal Immigrant Responsibility Act of 1996 states that the U.S. Citizen who gives up their citizenship to avoid U.S. income taxation is also banned from ever returning to the U.S. for any purpose.


I wrote the previous explanation in 1989 for the CFTA ) Canadian Free Trade Agreement) and then updated it a little for the NAFTA when Mexico was added in 1994.  It is downloaded from my website 30 to 300 times a day.


The USCIS (United States Citizenship and Immigration Service) has its own which you can find at the state Department at:  http://travel.state.gov/visa/temp/types/types_1274.html#3

Although this may have seemed to be very negative, I hope it will help you stay out of trouble in the future.

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Cash gift/divorce us / CANADA

QUESTION:

My (soon to be ex) husband is Canadian (green card) and I am a U.S. citizen. We were married 15 years.

In 1999 his parents bought the grandmother's home after her death. My mother-in-law wanted to live there in old age. They rented it out for 5 years then decided to sell it.

In 2004, my husband told me his parents were gifting he and I $22,000, his brother and his wife $22,000, and their single brother, $22,000.

In our divorce proceeding he is now claiming it was not a gift, but an inheritance to him.

At trial he testified he was given $22,000 in 2004 and $9000 in 2005 (which I was unaware of) for "tax reasons."

It is my understanding there is no gift tax in Canada. Is this correct?

Thank you for any insight you might provide.

-------------------------------------------------

david ingram replies:

I want to make it clear that I am NOT a lawyer although 'way back when' I did own a divoce service in Vancovuer, BC Canada.  However, that was 30 years ago and there have been a lot of changes since then.  Also, be advised that even though I had offices in 30 states and 5 provinces, I do not know where you live and these laws change for each and every state and province.  Even Community Property states have about seven different interpretations of Community property. 

If you type INCOME TAX and Divorce Help into Google today, I am number 10.  If you type in INCOME TAX AND DIVORCE EXPERT, I am number one and if you type in Income Tax and Divorce help US canada, I am back up to number 1.

That shows you that you can NOT trust what you find on the Internet because I assure you that there a few thousand people who know more about Divorce than I do. 

However, few have been involved in more divorces in terms of property settlements form more jurisdictions than I have so I guess I 'can' comment.  Just do not make a move taking what I say here as gospel because it may not have any bearing on the state you and your husband were living in at the time of the gift. / advance inheritance (which sounds like a US limited gift anyway if they (the parents) were still alive).

The amounts of the gift imply that someone was looking at US gift tax laws when the gifts were made and that the brothers were both living in the US as well Or, because they wanted everything equal and they thought (incorrectly) that they could only give their son in the US $11,000 each, they gave the same limited amount to his Canadian resident brothers as well.

The rules then were that although under Canadian Law, the parents could have made any amount of a gift that they wanted, they chose to give $11,000 each to each of their sons becauxe someone told them that they could only give the US son $11,000 each without gift tax having to be paid.

This makes me think that if your husband told you his parents had given both of you $22,000, he was being polite or trying to make his parents look better at the time because the facts would seem to say that each brother got $22,000 whether they were married or not.

Then you end up with the problem of whether the gift became a family asset and is subject to a split in a divorce. 

If you were living in British Columbia as one example, the $22,000 would have become a family asset (and dividable) if it was used for a family purpose.  If your husband put it in the bank and used the interest to buy groceries or took $5,000 and bought a second car for the family or used $4,000 for a family vacation, it became a family asset and you are entitled (IN BC) to claim half of what is left as a family asset.

If, on the other hand, hubby put it into a mutual fund in his name and the earnings were re-invested in the mutual fund, and he did not spend any of it on family matters, the gift or inheritance is his alone and not subject to dividing it up as a family asset.

This is not definitive but will give you something to think about and may help you with your decision as to what to ask for and what you are entitled to but "YOU" HAVE TO CHECK your local family law rules and regulations.  Under the circumstances, I do not think that Canadian Law has anything to do with the situation since we do not have either inheritance tax or gift tax here.

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