Canadian working in USA under TN, Tax return quote.
> Dear David
>
>
> I am a Canadian and working at Maryland, USA. I am working under TN. I
> went to USA to work since end of May 2007. From January 2007 to April
> 2007, I work part time at Vancouver. I am Single and
> I have cancelled all my Bank account, credit cards in Canada. I don't have
> any investment in Canada but I have 401K in USA since I start working.
> I and my family bought a townhouse in December 2007, so there is one
> property under my name ( I am the co-owner). I am confused about the Tax
> between Canada and USA, and from my understanding I have to file to both
> of them for year 2007. Do I have to write the determination of
> non-residence form to CRA before filing the tax-return for 2007? I am
> wondering how much it will cost if you help me to file the tax return to
> both country. Thanks very much.
--------------------------------------------
david ingram replies:
You need to file a departing Canada T1 tax return which will report the
income you earned in Canada. Normally, you would also need to file forms
1161, 1243 and 1244 as well but only if you still owned assets such as real
estate or mutual funds (anywhere in the world) when you left.
For the US, you have a choice of filing a 1040 Dual Status return plus a
1040NR dual status statement OR a 1040 with the Canadian income reported on
the 1040 as well. In this case, it would likely be less US tax because you
get to claim the full standard deduction and it is unlikely that your
itemized deductions would be enough to make a difference on a dual status
tax return. (That would not likely be true if you had bought your
townhouse in August and had 5 months of interest and taxes to deduct). You
make the tax owing on the US for the Canadian income by filing US form 1116
to claim the foreign tax credit OR you file a form 2350 extension and exempt
the reported Canadian Income of form 2555.. In other words, your US return
can be filed three different ways and there is NO right way without doing
all the calculations first.
For Maryland, the only choice is to form 502 and mark a P on the right hand
side 1/3rd of the way down to indicate that you are a part year resident. If
the 2350/2555 choice was made for
If we help you (that is what we do) the fee would be between $900 and
$2,900. Moving in or out of the country with income in both countries and no
Canadian assets and no RRSP accounts will likely be in the $1,200 range.
You can get a better idea of our costs by looking at the pricing down below.
I am confused by the contradiction in your question. First you say you are
single - then you say your 'family' bought the townhouse. Did your parents
or siblings buy half to help you out or are they living there with you.
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David Ingram gives expert income tax & immigration help to non-resident
Americans & Canadians from New York to California to Mexico family, estate,
income trust trusts Cross border, dual citizen - out of country investments
are all handled with competence & authority.
Phone consultations are $400 for 15 minutes to 50 minutes (professional
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This is not intended to be definitive but in general I am quoting $900 to
$2,900 for a dual country tax return.
$900 would be one T4 slip one W2 slip one or two interest slips and you
lived in one country only (but were filing both countries) - no self
employment or rentals or capital gains - you did not move into or out of the
country in this year.
$1,100 would be the same with one rental
$1,300 would be the same with one business no rental
$1,300 would be the minimum with a move in or out of the country. These are
complicated because of the back and forth foreign tax credits. - The IRS
says a foreign tax credit takes 1 hour and 53 minutes.
$1,600 would be the minimum with a rental or two in the country you do not
live in or a rental and a business and foreign tax credits no move in or
out
$1,700 would be for two people with income from two countries
$2,900 would be all of the above and you moved in and out of the country.
This is just a guideline for US / Canadian returns
We will still prepare Canadian only (lives in Canada, no US connection
period) with two or three slips and no capital gains, etc. for $200.00 up.
With a Rental for $400, two or three rentals for $550 to $700 (i.e. $150 per
rental) First year Rental - plus $250.
A Business for $400 - Rental and business likely $550 to $700
And an American only (lives in the US with no Canadian income or filing
period) with about the same things in the same range with a little bit more
if there is a state return.
Moving in or out of the country or part year earnings in the US will ALWAYS
be $900 and up.
TDF 90-22.1 forms are $50 for the first and $25.00 each after that when part
of a tax return.
8891 forms are generally $50.00 to $100.00 each.
18 RRSPs would be $900.00 - (maybe amalgamate a couple)
Capital gains *sales) are likely $50.00 for the first and $20.00 each after
that.
Catch - up returns for the US where we use the Canadian return as a guide
for seven years at a time will be $150 to $500.00 per year depending upon
numbers of bank accounts, RRSP's, existence of rental houses, self
employment, etc.
Just a guideline not etched in stone.
This from "ask an income trusts tax service and immigration expert" from
www.centa.com or www.jurock.com or www.featureweb.com. David Ingram deals on
a daily basis with expatriate tax returns with multi jurisdictional cross
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