---------------------------------------
david ingram
replies:
You can do any work you want down there on line for a
Canadian, French, Polish or South American Company as long as it does not have
a US Nexus. In other words, if the State of California or the
State of Nevada or a company in New York hired your old Canadian company to do
work, you could NOT do the work in Arizona or anywhere else in the US.
However, if the work is for the Province of BC or the Province of
Manitoba
or the Government of Saudi Arabia, you could do the telecommuting
from your home in Arizona.
BUT , since the work was performed 'within'
the US, it is NOT taxable in Canada and does NOT go on your 2008 Canadian
Income Tax return unless you are coming up to Canada to do some of it in which
case, it would be pro-rated. You would fill out a USA self-employed
Schedule C on what would now be a joint tax return with your
husband.
Since your ITIN is not valid for working in the US, we would
attach a note stating that the money was NOT earned working for or doing
services for a US entity.
This does not stop your old company accepting
a US contract. the person who bought your business could do the US
contract in Canada and you could look after Canadian business in the
US.
-----------------
QUESTION:
Hi David,
I am a TN
visa holder working in Seattle, and my wife is on a TD visa and she is citizen
of China. We are determined as non-resident to Canada.
Can she
telecommute from the US, and providing software consulting service to Canadian
company? Is she allowed to work remotely while being a TD visa
holder?
Does she need to file taxes to CRA?
Thank you very
much.
--------------------------------------------------------------------------
david
ingram replies:
She is not supposed to take a job away from a legal US
resident.
Telecommuting to Canada does not take a US job away and
should not be a problem.
The Canadian Employer should not withhold any
Canadian tax either.
She does NOT owe tax to Canada if she provides all
her services from the USA.
She will / does owe tax to the US on the
earnings and it should be reported on a schedule C on your joint 1040 US tax
return.
She will also owe FICA (Social security tax) and should. send
in form SE as well.
Hope this
helps
------------------------------------
QUESTION:
I am
currently living in Illinois. I am about to come off of maternity leave
from my Toronto company and I
intend to continue to work for them through
the Internet. My US immigration has not gone through yet. Do
I
need to wait until I have US status to work or can I start right
away since I'll be working only for my
Canadian
company?
--------------------------------------------------
david
ingram replies:
You can telecommute. You will owe tax to the US NOT
Canada.
You might want to send the returns
here.
------------------------------------------
SUGGESTED
PRICE GUIDELINES - Aug 5, 2008
david ingram's US / Canada
Services
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Specialists
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Mexico family, estate, income trust trusts Cross border, dual citizen -
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Phone consultations are $450 for 15 minutes to 50
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expert US Canada Canadian American Mexican Income Tax
service and help.
This is not intended to be definitive but in general I am
quoting $900 to $3,000 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.
$1,200 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
$3,000 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. However, if you have a stack of 1099, or T3 or T4A or T5
or K1 reporting forms, expect to pay an average of $10.00 each with up to
$50.00 for a K1 or T5013 or T5008 or T101 --- Income trusts with amounts in
box 42 are an even larger problem and will be more expensive. - i.e. 20
information slips will be at least $350.00
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 from
$150 to $600.00 per year depending upon numbers of bank accounts, RRSP's,
existence of rental houses, self employment, etc. Note that these returns tend
to be informational rather than taxable. In fact, if there are children
involved, we usually get refunds of $1,000 per child per year for 3
years. We have done several catch-ups where the client has received as
much as $6,000 back for an $1,800 bill and one recently with 6 children is
resulting in over $12,000 refund.
Email and Faxed information is
convenient for the sender but very time consuming and hard to keep track of
when they come in multiple files. As of May 1, 2008, we will charge or
be charging a surcharge for information that comes in more than two
files. It can take us a valuable hour or more to try and put
together the file when someone sends 10 emails or 15 attachments, etc. We had
one return with over 50 faxes and emails for instance.
This is a
guideline not etched in stone. If you do your own TDF-90 forms, it is to
your advantage. However, if we put them in the first year, the computer
carries them forward beautifully.
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attachments) is not intended or written to be used or relied upon, and cannot
be used or relied upon, for the purpose of (i) avoiding penalties under the
Internal Revenue Code, or (ii) promoting, marketing or recommending to another
party any transaction or matter addressed herein.--
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