Thank you for looking at my question. I am a US citizen from upstate Washington recently married to a Canadian citizen from Vancouver. She has income from investments and from a consulting practice in Canada. I have my own business in the US primarily acting as a manufacturer’s agent for a Canadian company dealing only with US customers. Her income is substantially more than mine at present (40K vs. 90K). I have a large tax loss carry-forward in the US from a previous business. I have filled for my Canadian PR (from outside Canada at the advice of our immigration lawyer). The intention is to continue my business in the US, “commuting” from Vancouver. We are at a loss to understand how to file our tax return. Technically, I am still a resident of the US, she of Canada. I would hate to loose the tax loss carry-forward (about 500K US). Will Canada recognize the carry-forward? The ideal scenario would be for her to also take advantage of the tax loss. I don’t know if this is possible. What would be our best recourse? I currently have a CPA in the US who is very good, but with little experience in cross-border issues. Thank you for your time. --------------------------------------------- david ingram replies: If you move to Canada, you will effectively lose your loss Carryforward. Canada will NOT recognize a US loss from before you arrived. If you want to continure to use it, you must maintain your US residence and NOT become a Canadian resident. This would allow you to earn $500,000 tax free which is worth anywhere from $75 to 100,000 and a lot to give up for love. Your wife has no method of using the loss unless she moved to the US and filed a joint tax return with you and then, a substantial part of "her" income would have to be from US sources. Don''t tell anyone I suggested this but you could go to work for your wife in the US and she could maybe pay you $60,000 or so a year for the next five years and that would allow you to use up your loss in five or six years. Just an idea and you would have to do some work for her. If you decided to do something like this, she would have to visit you as much in the US as you visit her in Canada. You would both need what I call a border kit to continue to cross the border without too many hassles. Hope this helps ==================== 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 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 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. 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 or www.jurock.com or www.featureweb.com. 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