My_question_is: Applicable to both US and Canada Subject: tax liability Expert: taxman at centa.com Date: Saturday February 11, 2006 Time: 02:28 PM -0800 QUESTION: I am a Canadian citizen who started work and live in the US on a TN1 Visa in March 2005. 2005 is my first tax year where I have to file both in Canada and the US. I now have US accounts and did not close any Canadian accounts and have a US driver's license. I now have both RRSPs and a 401 K plan. What do I need to fill out in the US and Canada to reduce my tax liability in both countries? Will I need a lawyer as well as an accountant to determine my resident status? ==================================================== david ingram replies: You will file a departing Canada income tax return which should include a T1161 and maybe a T1243 and T1244. The fine for not filing the T1161 by April 30, 2006 for the 2005 year (if required) is $25.00 a day to a maximum of 42,500 and they are enforcing the fine. Then you will file a dual status 1040 return and the return for the state you are living in. The 1040 must also have an 8891 filed to report the internal earnings of the RRSP and a T DF 90-22.1 filed for each financial account left in Canada You do not need a lawyer. You should have notified all of your Canadian Financial institutions that you are now a non-resident. We would be happy to look after these returns for you. ----------------------------- David Ingram's US/Canada Services US / Canada / Mexico tax, Immigration and working Visa Specialists US / Canada Real Estate Specialists Home office at: 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Cell (604) 657-8451 - (604) 980-0321 Fax (604) 980-0325 Calls welcomed from 10 AM to 10 PM 7 days a week (please do not fax or phone outside of those hours as this is a home office) email to taxman at centa.com <mailto:taxman at centa.com> www.centa.com <http://www.centa.com/> www.david-ingram.com <http://www.david-ingram.com/> Disclaimer: This question has been answered without detailed information or consultation and is to be regarded only as general comment. Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist for expert help, assistance, preparation, or consultation in connection with personal or business affairs such as at www.centa.com <http://www.centa.com> . If you forward this message, this disclaimer must be included." Be ALERT, the world needs more "lerts" David Ingram specializes in giving expert income tax and immigration help to American and Canadian citizens living out of their home countries from Zimbabwe to Saudi Arabia to Mexico to China or Chile - Cross border, Non-resident - dual citizen - out of country investments are all handled with competence and authority. This from "ask an income tax and immigration expert" from www.centa.com <http://www.centa.com/> or www.jurock.com <http://www.jurock.com/> or www.featureweb.com <http://www.featureweb.com/> . 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