Contract income while on TN Visa

I am a Canadian working in the US on a TN VISA.   Am I allowed to do contract work for Canadian companies for projects in Canada on a telecommute basis while on a US TN VISA?

If not, can a person living in the US on a F1 dependant VISA have Canadian income and file CDN Tax returns?


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david ingram replies:

If a person is living in the US and telecomuting back to canda that is legal under US immigration law becasue they are not takig a job away from an American.  They are NOT taxable in Canada on that income because the work is not being done in Canada. 

They are taxable in the US and should file a Schedule C to report the income and pay tax, etc on a US 1040.

I have had dozens of clients in this position and no one has ever had a problem with the IRS or Homeland Security.  Just make sure that nothing is done for a US person or company,

If the Canadian employer insisted on paying you with a T4 and deducting tax, etc., you would file a Canadian return and ask for the tax back.  If you were actually going to Canada for a week a month and performing some of the job's duties 'in' Canda, you would then be paying some tax to Canada and claiming a foreign tax credit on US form 1116 as part of the US 1040.


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