Canadian married to American - Joint taxes OHIP

I recently married a girl from Maryland. I am a Canadian citizen but have no property in Canada just a Bank account - OHIP - car registration and Canada Pension ( I am 65)
My wife is five years younger and has a very good job.
We have been advised we have to file a joint tax return.
Does this mean my only source of income - my pension - is taxed in Canada and then added to her income to be taxed again at a really high rate in US ?
OR do they effectively add our incomes together and then average them between two people so it lowers the rate she pays?
Is it worth me keeping Canadian citizenship and pension if the former is the case?
How do they calculate the exchange rate as my pension is paid monthly throughout the year?
Many thanks for your great source of info

david ingram replies:

If you are a resident of the US, your OHIP is no longer valid. If you are living in the US, your Ontario car registration is no longer valid either.

If you are living in Canada and married to an American, you are still taxable as ever but have to include your wife's salary and that will stop a claim for any renter's credit or GST credit you have been receiving. However you can file a joint US return with your wife and save significant US taxes.

If you are a resident of the United States, your Canada Pension and OAS are no longer taxable in Canada.

They ARE taxable in the USA but are treated as Social Security. Depending upon the family income, they may not be taxable. If the income is high enough, the CPP and OAS will be taxable on a sliding scale up to 85% worth. that does NOT mean the tax is 85%.

What it means is that you would pay tax at standard rates on a maximum of 85% of the CPP or OAS.

Filing a joint return will definitely save your spouse money and not cost you any more tax than you would pay in Canada.

You might want to send this first return off to us in North Vancouver.



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