I obtained your email from your web site, http://www.centa.com/expert.html and was hoping you could answer a few questions for me.  I am a Canadian citizen by birth and moved to the US on 10/98 with an H1B visa.  It was re-issued and is valid until 2004.  I have been paying US taxes here since 1998 and have not been filing in Canada, I made no income there. 

My wife has been here on a spousal visa, not working.  And we have a child who is an American citizen.  We are now prepared to move back to Canada.  My questions are:

Was i right in not filing in canada?  Will I have to file for the years I missed?  And will I be re-taxed when I move back to canada for the income i made in the US?  I have some savings here and I am concerned I will be re-taxed by Canada for those savings.  I used to reside in Ontario, if that makes any difference.

I look forward to your response.If you feel that you do not want to answer my questions for any reason, can you please refer me to a tax specialist in Toronto who I may contact that can help me.

Thanks for your time.

Sam S.

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

1.    You should have filed a departing resident tax return up to October, 1998. 

2.    You should have filed a US 1040 "dual status" return for November and December in the US.

3.    You should have filed a US 1040 for 1999, 2000, 2001 and then file one for 2002.

4.    If you are coming home on Dec 31, 2002, you do not need to file a US 2003 return.  If you come back during 2003, you will file a "Dual status" US 1040 and then an "entering Canada" return from the day you arrive back.

5.    You would have reported the interest on dividend income on your US return on Schedule B.  Under Article IV of the US/Canada Income Tax Treaty, Canada has no right to tax the earnings while you were in the USA.

6.    When you come back to Canada, you will report any earnings on schedule 4 of the Canadian return.

7.    If you leave the investment(s)  in the US you must file a W8(Ben) with each financial institution. they will not withold any tax on interest or capital gains but WILL withhold 15% tax on any dividends you receive (this usually only if you own mutual funds).

We specialize in your kind of returns and can look after them by mail, fax or email anywhere in the world.

David Ingram