This is a multi-part message in MIME format. ---------------------- multipart/alternative attachment MessageIt amazes me how something as basic as this can slip by me for three years. You snooze you lose. I listened to a national open line program last Saturday where the expert had missed it as well. And just to check myself, I phoned three mutual fund RRSP people and asked them and they still thought the paper sale was important. Have put them on the list as well. Thanks Again Andrew. That's two today. But it is also what keeps this information up to date. No one person can possibly do it alone. david ingram =============================================== David, As of Sept. 18, 2000 US allows former cdn residents to use the "deemed disposition" value as the new cost base for any future capital gains calculations arising in US. This avoids the need for these paper sales just before departure. It will be part of the next treaty ratification, but IS IN EFFECT NOW (Since Sept 18, 2000) I can locate the Dept. of Treasury or Ministry of Finance links on this if you would like. Here's one: http://www.fin.gc.ca/news00/00-068e.html Here's the other: http://www.ustreas.gov/press/releases/ls883.htm These are in effect RIGHT NOW!! Thus, a cdn leaving Canada after Sept 18, 2000 has a choice as to the cost basis when eventually selling an investment: either the original cost basis or the deemed disposition value (which ever is highest, of course). Andrew -----Original Message----- From: [email protected] [mailto:[email protected]] Sent: Tuesday, January 27, 2004 02:57 To: CENTAPEDE Subject: Canadians move from BC to California on L1 Visa QUESTION: When moving from BC, Canada to California, USA we understand from meeting with you that there will be Canadian departure tax on capital gains accrued to the date of departure. Upon subsequent sale of investment we also understand that California and Federally the gain will be calculated based on the actual original cost. For purposes of determing whether it will be treated as a capital gain (i.e. held > 1 yr) or as income (held < 1 yr) does the US and California look to the original purchase date or to date of becoming US tax payer? Upon sale of a publically traded security purchased as a Cdn resident and sold after becoming a US resident, are we required to report on both a Cdn and US tax return or just on a US return? ================================================================= = david ingram replies: The US will tax you from the purchase date. That is why you should sell and reacquire your holdings the day before you leave Canada does not tax that publicly traded share if sold when you are now in the US AND you paid the departure tax. If you have filed form T1243 to defer the tax, you WILL pay tax to Canada on the sale in the US but it will be the original calculated departure tax, not the actual profit or loss on the date of sale. Canada does not treat your sale and repurchase as an actual sale unless there is a 30 day gap between the sale and reacquisition. The US will, however, treat the reacquisition price as the cost price. 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 Bus (604) 980-0321 [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 immigration planning and bankruptcy expert consultant guru or preparer from www.centa.com or www.jurock.com or www.featureweb.com. 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