QUESTION: I moved to Hawaii in November 2004, worked for a week in December and filed my 2004 state and federal taxes in Hawaii, reporting just this income. I've since learned that I am actually required to report my worldwide income (my Canadian income) as well. Since I only filed a 1040, which other forms must I file to ammend my 2004 return? ===================================================== The form to amend a 1040 or a 1040NR is the 1040X form. And , there are likely three possibilities. 1. You are a US citizen or green (resident alien) card holder. If this is the case, your 1040 must include your world income including wages, rents, bonuses, scholarships, interest, dividends, royalties, alimony, employment insurance, self employed business farming or fishing income and any gambling, lottery or jackpot winnings. If this is the case, and you have already reported these amounts to Canada, you would claim a foreign tax credit on form 1116 for everything. However, in the case of wages or self employment, you may chose to exempt them using form 2555 which exempts foreign earnings up to $80,000 pro-rated by the number of days you were in Canada and providing you fall into one of two categories. The categories are physical presence which means that you have been out of the USA for 330 out of 365 days or bone fide residence which means that you have lived in another country for an entire calendar year. 2. You have just gone to Hawaii under an L1, H1 or TN visa. Judging from your email address, I suspect an H1 or TN visa. IN this case, you had three choices. A File a 1040 as you did and only report the US income but check off the dual status box (38b) at the top of page two of the 1040. this means that you do NOT get the standard deduction but have to itemize. Also put "DUAL STATUS RETURN" across the top of page one of the return. THEN you have to file a 1040NR to report any US income you may have had while you were not a resident of the US. This is usually just a bunch of zeros. Put "DUAL STATUS STATEMENT" across the front of the 1040NR. B. Just file a 1040NR reporting the US earnings. If it is under $10,000 (likely) you could even claim the Article XV Canada / US Tax Convention (treaty) exemption of earnings under $10,000. You would do this on page 5 of the 1040NR. However, if you did that, you would have to add it on top of Your Canadian income on your Canadian return and pay a higher tax rate. Better to calculate the tax which will be "identical" to the 1040 Dual Status return above. C You could do as you imply in your question and report the world income as in "1" above claiming full exemptions and deductions and foreign tax credits or exemptions. In this case, your tax would be the same as in 1 above. In either case, your Canadian return should have pro-rated exemptions which means that you put the date of departure on the front of the Canadian Return and prorate your exemption amount of schedules 1 and 428 of the Canadian return. 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, I, david ingram am a permanent guest on Fred Snyder of Dundee Wealth Managers' 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 <http://www.600am.com/> Call (604) 280-0600 to have your question answered. BC listeners can also call 1-866-778-0600. Callers to the show and questioners on this board can also attend the Thursday Night seminars on finance and making your Canadian Mortgage Interest deductible. 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 9 AM to 9 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. 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CEN-TA Cross Border Services - Tax, Visas, Immigration
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