Moving back to Winnipeg with green

I am writing to you today to see if you can be of service to me.
I am detailing here some information about our current situation,
and what our existing accountant and an accountant in Canada has
advised us to do. A friend recommended that I run this by you to
see if it makes sense.
I will be relocating to  Canada  after having lived for 13 years
in the USA. We are returning Canadian citizens (Canadian
passports), having been in the USA with Greencards until now. My
wife will not be working when we return, and we have two children
(6 and 4). I will be operating a home-based consulting business,
providing all my services to a single USA client. I may branch
out to other clients in the future, but for now, the USA client
will be using all my services (plus minor expenses such as paper,
ink cartridges, Internet connection, etc.) I expect to bill the
US client approximately $120,000+ US/year (roughly $140K
Canadian). Other expenses, such as office furniture, electricity,
etc., will be considered my own business expenses. I do not need
to incorporate and will be able to charge 0% GST for the services
I will be providing to the US client(s). Income splitting,
employing my wife in the business, will most likely be a good
idea to reduce our taxes.
The USA client has no presence in Canada.
I have ownership in several other companies in the USA which I
hope to maintain (all small LLC that produce a loss or bearly
break-even). In the USA, I will be filing taxes only for the
profit/loss for these companies (K1 Schedule) and will be drawing
no income from any of them. I assume, since none of the
profit/loss on the foreign investment will be pulled into Canada,
that this is not taxable in Canada. All profit/loss from the US
ventures will remain in the USA.
We will be selling our house here in the US and moving back to
Canada in July. The funds will be transferred electronically to a
Canadian  financial institution.
We know that we need customs paperwork for the vehicles and
belongings, and that we will be paying GST for the excess over
$10,000 on the value for any of our vehicles and boat.
I will be maintaining a US bank account and still have IRAs in
the US. These will remain in the US, and I understand that any
funds transferred from the US bank account to Canada will be
taxable and viewed as income.
I'm not sure on what to do about the IRA we have here. I guess
that is the main reason why I wrote. I am only  38 right now, so
there is still some time before I plan on pulling funds.
Let me know what you think and whether or not you can assist me.
Sincerely,
--------------------------------------------------------
david ingram replies:
You are likely making a mistake to come back to Canada without
taking out US citizenship first.
You "can" file Form I-131 first and this gives you the right to
keep your green cards alive. on an annual basis but you have to
fill one out each year.  Keeping yours alive allows you to
continue to work in the US but it is my experience that 4 or 5
years is about the most they can be renewed.
The longest I ever saw I-131 forms to keep a green card alive
before the family made the decision to move back to the US was 8
years ..
Taking out your US citizenship allows you to move freely across
the border both ways.  I do not know what you do but if you lose
the present contract for any numb er of reasons I can think of
and you need more American business because the  xxxxxxxxxx
market is a little weak, you will / could find yourself unable to
replicate what you did in the past.
I started  d what I do at 2000 Pembina Highway in Fort Gary ,
Manitoba and can testify from first hand experience that I wish i
had taken out US citizenship before returning to  Canada 40 years
ago.
The IRA is simple,  You can just leave it where it is for another
20 or 23 years and then take it out as a pension or you can take
it out now, pay the tax and penalty in the US and roll it into an
RRSP, and then use the tax paid to the US (less the 10% penalty)
as a foreign tax credit in Canada.  I do NOT recommend this
process.
My suggestion is that you take out US citizenship before
returning to Canada.
Anything you receive on a K-1 is taxable in Canada whether you
take the money to Canada or not.  If it is credited to your
account by raising the ACB, it is taxable.
I searched   Yahoo for you and found you all over the place with
references to status in several different ventures,  You can be
part and parcel of all those with a Green card or  US
citizenship.  If you return to  Canada and then want to go down
to work for one of them  (maybe to save your investment), you
will need an individual visa for each company.  A foolish move
(in my opinion) for someone of your obvious stature.  I know you
would rather be fishing but you are going out without an obvious
and easily obtained  life jacket.
-----------------------------------
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.
international non-resident cross border income tax help
assistance expert preparation & immigration consultant david
ingram, experts on rentals mutual funds RRSP RESP IRA 401(K) &
divorce preparer preparers consultants
New York, Boston, Sacramento, Minneapolis, Salem, Wheeling,
Philadelphia,
Pittsburgh, Atlanta, Pensacola, Miami, St Petersburg, Naples,
Fort Myers,
Cape Coral, Orlando, Atlanta, Arlington, Washington, Hudson,
Green Bay,
Minot, Portland, Seattle, St John, St John's, Fredericton,
Quebec, Moncton,
Truro, Atlanta, Charleston, San Francisco, Los Angeles, San
Diego,
Sacramento, Taos, Grand Canyon, Reno, Las Vegas, Phoenix, Sun
City, Tulsa,
Monteray, Carmel, Morgantown, Bemidji, Sandpointe, Pocatello,
Bellingham,
Custer, Grand Forks, Lead, Rapid City, Mitchell, Kansas City,
Lawrence,
Houston, Albany, Framingham, Cambridge, London, Paris, Prince
George, Prince
Rupert, Whitehorse, Anchorage, Fairbanks, Frankfurt, The Hague,
Lisbon,
Madrid, Atlanta, Myrtle Beach, Key West, Cape Coral, Fort Meyers,
Berlin, Hamburg
Warsaw, Auckland, Wellington, Honolulu, Maui, Kuwait, Molokai,
Beijing,
Shanghai, Tokyo, Manilla, Kent, Winnipeg, Saskatoon, Regina, Red
Deer, Olds,
Medicine Hat, Lethbridge, Moose Jaw, Brandon, Portage La Prairie,
Davidson,
Craik, Edmonton, Calgary, Victoria, Vancouver, Burnaby, Surrey,
Edinburgh,
Dublin, Belfast, Glasgow, Copenhagen, Oslo, Munich, Sydney,
Nanaimo,
Brisbane, Melbourne, Darwin, Perth, Athens, Rome, Berne, Zurich,
Kyoto,
Nanking, Rio De Janeiro, Brasilia, Colombo, Buenos Aries,
Squamish,
Churchill, Lima, Santiago, Abbotsford, Cologne, Yorkshire, Hope,
Penticton,
Kelowna, Vernon, Fort MacLeod, Deer Lodge, Springfield, St Louis,
Centralia,
Bradford, Stratford on Avon, Niagara Falls, Atlin, Fort Nelson,
Fort St
James, Red Deer, Drumheller, Fortune, Red Bank, Marystown, Cape
Spears,
Truro, Charlottetown, Summerside, Niagara Falls, Albany Zimbabwe
 David Ingram expert income tax help and preparation of US Canada
Mexico non-resident and cross border returns with rental dividend
wages self-employed and royalty foreign tax credits
international non-resident cross border income tax help
assistance expert preparation & immigration consultant david
ingram, experts on rentals mutual funds RRSP RESP IRA 401(K) &
divorce preparer preparers consultants
This from "ask an income tax and immigration expert" from
www.centa.com or www.jurock.com or www.featureweb.com. David
Ingram deals on a daily basis with expatriate tax returns with:
multi jurisdictional cross and trans border expatriate problems
for the United States, Canada, Mexico, Great Britain, United
Kingdom, Kuwait, Dubai, Saudi Arabia, Thailand, Indonesia, 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, and any of the 43 states with state tax returns, etc.
Rockwall, Dallas, San Antonio Houston
Denmark, Finland, Sweden Norway Bulgaria Croatia Income Tax and
Immigration Tips, Income Tax  Immigration Wizard Antarctica
Rwanda Guru  Consultant Specialist Section 216(4) 216(1) NR6 NR-6
NR 6 Non-Resident Real Estate tax specialist expert preparer
expatriate anti money laundering money seasoning FINTRAC E677
E667 105 106 TDF-90 Reporting $10,000 cross border transactions
Grand Cayman Aruba Zimbabwe South Africa Namibia help USA US
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"
 .
-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://www.centa.com/CEN-TAPEDE/centapede/attachments/20060303/1ad35bb2/attachment.htm

Trackback

Trackback URL for this entry: http://www.centa.com/trackback.php/UsCaWeekofMon20060227002474.html

No trackback comments for this entry.

0 comments