QUESTION: Dear Sirs/Madams, I would thank you and appreciate your valuable peiece of advice on the following: MY CURRENT SITUATION: --------------------- I have got an offer from an US company to work for them as a System Analyst on contract basis in Dearborn, Michigan. The initial duration would be 9 months. It might get extended or might not be extended, depending on the situation. I will be relocating form Toronto to Windsor,Ontario and commute daily to work in Michigan and come back home in the evening. I am a Canadian Citizen. I will be working under TN1 visa for my prospect employer in US. I already have my corporation operating in Canada. My prospect employer is willing a) either to pay net amount after the US tax deductions as monthly salary for my service in US (ie. W2 BASIS ) OR b) to remit money to my corporation in Canada without any tax deduction (corp 2 corp basis), where as an employee of my corporation I would draw the salary and pay taxes in Canada. I don't have any thing connected in US such as mailing address or car etc. I would be a daily a commuter to US from morning 9 to 5 pm. MY QUESTIONS: ------------- 1) Can I choose option # B, ie. b) remit money to my corporation in Canada without any US tax deduction, where as an employee of my corporation I would draw the salary and pay taxes in Canada. 2) Would the above option is legal under TN-1 Visa and Canada/US treaty. I would appreciate your answer on the above and thank you in anticipation. ======================== david ingram replies: Your first liability is to the United States and Michigan. Your "second" liability is to Canada because you will be living in Canada. Your corporation can NOT be paid. You do not have a visa to work for your Canadian Corporation in the United States. Your best bet is to be paid on a W-2 slip and pay the US taxes. Do NOT participate in a 401(K)_ plan. If they have one into which they deposit money on your behalf (matching funds), have them pay you the extra directly. Then you can buy a Canadian RRSP. If you are a married man and moving to Windsor so that your wife can continue to work in Canada, you would pay less tax by moving to Michigan and having your wife commute back to Canada. That way, you would get to file a joint return in the US at a lower tax rate. Your wife's income would also be included on the US return but there would be a foreign tax credit for the taxes already paid to Canada. Of course, if the job was only for 9 months, you would have another moving expense which would eat up the immediate tax savings so your present course of action is likely okay. Answers to this and other similar questions can be obtained free on Air every Sunday morning. Every Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of Cartier Partners and I will be hosting an INFOMERCIAL but LIVE talk show called "ITS YOUR MONEY" Those outside of the Lower Mainland will be able to listen on the internet at www.600AM.com Local phone calls to (604) 280-0600 - Long distance calls to 1-866-778-0600. Old shows are archived at the site. This from ask an income tax immigration planning and bankruptcy expert consultant guru or preparer from www.centa.com or www.jurock.com or www.featureweb.com. Canadian David Ingram deals daily with tax returns dealing with expatriate: multi jurisdictional cross and trans border expatriate gambling refunds for the United States, Canada Mexico Great Britain the United Kingdom, Kuwait, Dubai, Saudi Arabia, South Africa, Thailand, Indonesia, Egypt, Antarctica, Japan, China, New Zealand, France, Germany, Spain, Italy, Russia, Georgia, Brazil, Peru, Ecuador, Bolivia, Scotland, Ireland, Hawaii, Florida, Montana, Morocco, Israel, Iraq, Iran, India, Pakistan, Afghanistan, Mali, Bangkok, Greenland, Iceland, Cuba, Bahamas, Bermuda, Barbados, St Vincent, Grenada,, Virgin Islands, US, UK, GB, American and Canadian and Mexican and any of the 43 states with state tax returns, etc. income tax wizard wizzard guru advisor advisors experts specialist specialists consultants taxmen taxman tax woman planner planning preparer of Alaska, Alabama, Arkansas, Arizona, California Denver Colorado, Connecticut, Delaware District of Columbia Miami Florida, Garland Georgia, Honolulu Hawaii, Idaho, Illinois, Indiana Des Moines Iowa Kansas Kentucky, Louisiana Bangor Maine Maryland Boston, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico,New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon. Paris, Rome, Sydney, Australia Hilton Pennsylvania, Rhode Island, Rockwall, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, West Virginia, Wisconsin, Wyoming, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec City, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland, Yukon and Northwest and Nunavit Territories, Mount Vernon, Eumenclaw, Coos Bay and Dallas Houston Rockwall Garland Texas Taxman and Tax Guru and wizzard wizard - David Ingram's US/Canada Services US/Canada/Mexico Tax Immigration & working Visa Specialists US / Canada Real Estate Specialists 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Calls accepted from 10 AM to 10 PM 7 days a week Res (604) 980-3578 Cell (604) 657-8451 Bus (604) 980-0321 davidingram at shaw.ca www.centa.com 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 & the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent financial, or real estate planner or advisor & appropriately qualified legal practitioner, tax or immigration specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included." ask an International real estate mutual funds immigration income tax expert experts - David Ingram 's CENTA Services in North Vancouver BC Canada AM600 Radio -------------- next part -------------- An HTML attachment was scrubbed... URL: http://www.centa.com/CEN-TAPEDE/centapede/attachments/20040801/86d785d7/attachment.htm
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