How to achieve the goal of being considered a deemed non-resident of Canada while holding TN visa -

My_question_is: Applicable to both US and Canada
Subject:        How to achieve the goal of being considered a deemed
non-resident of Canada while holding TN visa
Expert:         taxman at
Date:           Sunday January 21, 2007
Time:           01:06 AM -0500
Dear David,
Last year I learned from your hundreds of pieces of advice about how a TN
visa holder filed a smart Canadian tax return, while my husband moved to the
east coast of US with TN visa in the mid of 2005 and our child and I
remained in Vancouver. Finally, CRA rejected our use of Line 256 to exempt
my husband’s US employment income despite of his declaration about the
intention of moving whole family to US soon and the proof of his US tax
resident alien status as well as the severance of some secondary ties such
as MSP, driver license in Canada. CRA’s explanation was simple and firm: the
only fact that me, our child and a home remained in Canada constituted my
husband’s Center of Vital Interest under the tie-breaker rule of the tax
The exhausting situation didn’t allow us to spend more time on arguing with
CRA. What we did to response was paying what CRA wanted including the tax
interests and moved everything from Canada to US in August 2006. Afterwards,
CRA determined we became Canadian tax non-residents as of the day we
departed from Canada.
The new filing season comes. We face the same problem. My husband has
already received his tax package from Canada which is used for a BC
resident. We all know CRA will prefer applying their last year’s rule to my
husband’s 2006 part year return, even though he didn’t earn any Canadian
source income, he didn’t own any property in Canada, he didn’t share any
Canadian social benefit and he had not visited Canada until the last 20 days
to come back in helping moving us and all of our households to US. I have
never agreed CRA’s application. I studied countless times on the Article IV
of the tax treaty and every related text from CRA and IRS tax publications.
I am trying to convince myself CRA is right and we are wrong, but I’m not
able to achieve that.  I hope to get your professional opinion that tells me
whether my husband’s situation was not sufficient enough to escape from
Canadian tax on his US income, or whether it is just a matter of technical
skills on how to effectively make our point to CRA.
I think the conflict between CRA and we is the way to define the concept
“Centre of Vital Interests”. In other words, our conflict is on how to exam
my husband’s personal and economic relations with Canada and US. According
to CRA’s assessment notice to my husband’s 2005 tax return, it looks a
rental home in Canada, a wife and a child living in Canada can solely
override all other personal and economic ties that my husband has given up
in Canada and established in US, where he works for his only source of
employment income as well as all passive incomes; where he pays rentals for
his habitual abode; where he owns financial accounts to perform all of his
economic activities in the world. Moreover, my husband’s US tax resident
alien status seems not important for CRA to consider he could be actually
treated as a deemed non-resident of Canada under the tax treaty.
I’m trying to forget the money lost last year and regain a hope this year,
as the nature of our situation brings my husband’s personal and economic
relations much closer to US than Canada, plus the fact that moving whole
family from Canada to US in the year. However, I’m aware it’s not easy to
argue fairness with such an authority. Still, I want to learn how you would
judge the situation. I believe any of your opinion would be educative to me.
Reading your emails has been part of my daily life for the past 11 months.
Thank you for reading this long message. I’ve started to wait for seeing
your advice.
david ingram replies:
we likely did 40 of these last year with only one failure that I know of and
that one was because the Canadian spent a lot of time in Germany and was not
in the US for more than 183 days.
You should file a "Notice of Objection - A T400" and go through more
official channels.
The fact that you have all moved to the US is now evidence of the intent.
For 2006 you should exempt everything on line 256.
Congratulations on attempting it but I am not surprized that you lost.  It
is  not something that many people would win on their own.
I can only think of four or five people in the tax preparation business who
would be able to do it successfully on a regular basis.
It is also the hardest to do with a TN.  To be successful, there usually has
to be an attempt to be getting an H1 visa when the spouse is still in
On the other hand we have been successful for years with people where the
wife is still in Canada and has had two more children because she refuses to
go until he has his Green card so that she can work as well.  i.e. - the
family's hearts and souls are in the US.  Hubby has to have a place big
enough for the family and the family has to be visiting him in the US on a
regular basis.
If he always comes home to Canada and you do not visit him in the US, it is
hard to make work.
 David Ingram's US / Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
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 9 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 <mailto: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."
Be ALERT,  the world needs more "lerts"
David Ingram gives expert income tax & immigration help to non-resident
Americans & Canadians from New York to California to Mexico  family, estate,
income trust trusts Cross border, dual citizen - out of country investments
are all handled with competence & authority.
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,
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, income trust
international non-resident cross border income tax help estate family trust
assistance expert preparation & immigration consultant david ingram, income
trusts experts on rentals mutual funds RRSP RESP IRA 401(K) & divorce
preparer preparers consultants
This from "ask an income trusts tax and immigration expert" from <>  or
<>  or <>
. 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 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 family estate trust trusts
Alaska,  Alabama,  Arkansas,  Arizona,
California,  Colorado, Connecticut,
Delaware, District of Columbia,  Florida,
Garland, Georgia,  Hawaii,  Idaho,  Illinois,
Indiana,  Iowa,  Kansas,  Kentucky,
Louisiana,  Maine,  Maryland,
Massachusetts, Michigan, Minnesota,
Mississippi,  Missouri,  Montana,  Nebraska,
Nevada, New Hampshire,  New Jersey,
New Mexico, New York, North Carolina,
North Dakota,  Ohio,  Oklahoma,  Oregon.
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 - consultant - expert - advisor -advisors consultants - gurus - Paris
Prague Moscow Berlin
Lima Rio de Janeiro, Santaigo Zimbabwe


Trackback URL for this entry:

No trackback comments for this entry.