Canadian working on properties in the USA or Thailand - Watch it - Canadian-USA-Global tax help - david ingram expert US CANADA

My question is: US-specific

QUESTION: I noticed that your website uses a lot of fear mongering when it comes to doing improvements on a USA Property. fact is that every Canadian that i know builds their own decks,paints,or any other work that needs to be done on their property. there is simply no agency that can investigate it , there are over 11 million illegal immigrants they cant even catch......please dont fear monger!

Ozzie Jurock replies:

oz wrote:

As a Canadian:
1. If you own a holiday home in the US, you can renovate to your heart's content.
2. If you own an investment property, you have to hire someone to do it for you.
    You can't renovate, can't collect rent etc.

That's not fear-mongering, that is the law.

david ingram replies:

Since I am the author of the warnings, I suppose that I should make the point further,.

If you, as  a Canadian wish a summer or winter home in he US, you may buy a lot and dig a hole and lay a foundation and frame, roof, plumb, wire and finish the interior of your home.  You can buy a bulldozer or rent one or hire an operator with one to dig that hole and finish off the driveway, and then you can spread the gravel or mix and pour your own concrete for the driveway and sidewalk and patio pad.

However, if you intend to rent it out of for even a day a year or provide it for your employees to use for their holidays, you can not do any of the above except buy the lot or the property and hire US citizens or US resident aliens to do any work on it or collect rent for you.

And, if it is for your own use, your brother, sister, next door neighbour or even adult children may not work on the project either.  If they do, they are liable to arrest, fine, imprisonment, deportation and banishment from the USA as you are if you work on the unit which is intended for rent or business use or is already being used for business use.

You are also (I hate to say it) rather naive to think that Homeland Security does not have the facilities to catch you when they can not catch 11,000,000 illegal aliens.

Homeland Security has a multitude of informers who will  and do report Canadians doing work on their own properties.  I have seen or talked to dozens of people who have been arrested because a painter, dry waller, house cleaner, irate tenant or rental manager has reported them.  What happens is that the owner asks for a quote to paint the rental suite and then does it himself.  the painter sees the fellow painting his own suite and turns him or her into Homeland Security and Homeland security comes along and arrests you and puts you into an immigration holding cell with 84 other illegals who have been rounded up that week and you have to come up with $5,000 US bail to get out of jail and then suffer deportation and being banned from the US for 3, 5 or 10 years.

This can happen anywhere.  You may want to read the following about a Canadian working on the council of his five rental condos in Thailand. 

One strata council in Point Roberts had a problem with the president of the council being a Canadian and firing a maintenance worker in the complex.  The maintenance worker complained to Homeland Security.  I regularly advise Canadians to stay off the strata council when they own units in the USA. 

For the Thailand story, see

I wish I could go along with your wish to stop fear mongering.  However, it is really tough when you are a nice Canadian and they arrest you for painting your condo five months AFTER the fact because the tenant you evicted phoned Homeland Security.

Remember. under US law, the penalty for painting a unit can be more serious and damaging to the perpetrator then  the spontaneous holdup of a corner store.

So, if you are painting, cleaning and collecting rent for a piece of business real estate, stop now.

If you are merely fixing up a place that you use exclusively for pleasure and your own family, paint away, but do not help a neighbor, even if the American neighbor helped you first.

A lady at my house today, a US Canadian dual citizen who paints and decorates and cleans the eves on her rental units had to use the police to evict a 16 year tenant who threatened her with a knife.

You never know when the tenant or a neighbour will become an enemy.  Think of a divorce.  The combatants used to sleep together and may have produced half a dozen children.  My understanding is that the IRS and CRA gets half their tips from ex spouses.

The nice thing is that the Canadian can be bailed out quickly in the USA.  In Thailand, you can rot in the jail for months.  When you do read the Thailand one (and be sure you do) read the whole thing.  Do not just dismiss it because the rules are very similar to the US rules.  BEWARE!
david ingram

copied to Ozzie


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