US taxes for dual citizen in

I heard you on the radio, and am contacting you out of final
I am a dual US and Canadian citizen living in Vancouver. Since
divorced from a  husband  who worked on both sides of the border
(also a US
and Canadian citizen) three years ago, it has become very
difficult for me
to pay between $600 and $700 Canadian to a tax service ( xxxxx
xxxx), in
order to then make a yearly payment of "only" $US 1300 in taxes.
I had the
insane idea that I would be able to figure out how to do the
forms with the
help of friends this year (after all, it took only an hour or so
to do the
Canadian forms.) I have asked at places like H & R Block, and
they can't
help me.
I can't tell you how frustrating it has been trying to use last
year's forms
to guide me through the US mess. I am a high school drama
teacher, and can
barely understand the text--it is in English isn't it?  Neither
could I find
all the necessary materials on the internet. The IRS "help" dept.
has been
no help at all.
My finances are quite simple, I think. My ex-husband pays me
about $108,000
per year in alimony to cover my mortgage (he gave me the house)
and the
grossed up taxes on the mortgage payments. I earned about $30,000
as a
 xxxxxxxxx working for the  xxxxxxxxxxxx in 2005, so I write off
a few
things like professional dues and a course I take.  I have two
spousal (from the divorce settlement) and one of my own. That's
about all
there is to my financial story.
Do I really have to pay $700 in order to pay the US $1300 for the
of being a citizen?  I'm seriously considering giving up my US
over this. I was hoping not to have to give it up until I was
worried about
estate taxes, and leaving the house to kids, etc...I'm  41  now.
How can I be required to need a service so expensive?
david ingram replies:
Although you will not want to hear it, the price of $600 to $800
is not out of line for a US Canada Income Tax return, especially
when there are foreign tax credits, Alternative Minimum Tax and
RRSPs to report.
My usual quote to you would be $800 to $2,000 for a new client.
Repeat clients could still be in the $600 range but it would be
close. The price paid has nothing to do with the tax owing.  It
is based upon the complexity of the return.  There are likely
less than ten people in Vancouver who could do your return
competently.  The person you mention,  xxxxx xxxxx, is one of the
best and started his Canadian tax preparation career with me back
in 1970 or 71.
For the record, however, I was curious and ran a quick dummy
return and do not see that you should owe any tax to the US based
upon the $108,000 and $30,000 figures you mention. In fact, if
you happened to have two children at home, you would receive a
$50.00 US refund and if you had three children at home, a $1,050
US refund.
Basically, what you need to file is two 8891 forms, likely four
TDF 90-22.1 forms, two 1116 forms, two 1116AMT forms, one 6251
form, Schedule B, Schedule A, your 1040 and if you do not have
children at home, a 2555 form.
If you have 2 or more children at home, you should  NOT file a
2555 because you can claim the up to $1,000 child tax benefit.
You can find the 8891 form at for an example of the
You can find the TDF 90-22.1 form at
Note that this is far more serious than not filing form 8891 -
The penalty
for not filing the TD F 90-22.1 is up to $500,000 PLUS 5 years in
This form does NOT go to the IRS or with your tax return.  Send
it to the
Department of the Treasury in Detroit at the address on the form.
David Ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa
US / Canada Real Estate Specialists
My Home office is 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  Vancouver (LA)
time -  (please do not fax or phone outside of those hours as
this is a home office)
email to taxman at
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 If you forward this
message, this disclaimer must be included."
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