Recent Posts

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1
Hi there

It can be difficult to hit all the tax planning items without gathering all related fact, however let me give you some guidance below:

- You US taxable accounts will be re-valued for Canadian purposes. You'll want to print off some snapshots of the fair market value of the individual securities to ensure you can adjust each security's ACB to FMV upon arrival

- Yes, best to avoid Canadian mutual funds and TFSA accounts once in Canada. However some mutual funds do provide PFIC reporting that allow US clients to hold Canadian mutual funds while in Canada

- Easiest to sell the California home before you enter Canada

- Might want to review securities with losses that may end up being taxable in Canada is they increase in value and are sold after entry

- IRA accounts could be converted to ROTH IRA accounts. This can be beneficial if you tax rate in the year of entry is relatively low.

Hope that helps.

Phil
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US-Canada Tax Questions / Guidelines for US to Canada move
« Last post by dsugar on January 30, 2019, 12:04:55 PM »
My wife and I are dual US/Canadian citizens currently living in California. We are selling our house in California and moving to and purchasing a house in Victoria this summer. We are selling our California house prior to moving, and the purchase of the Victoria house will probably be completed before we move (assuming we find something).

Are there any general guidelines of things to do or avoid pre/post move from a tax perspective?

Here's what I'm aware of currently:
- For investments in our US taxable account we will transfer them in-kind to a Canadian brokerage shortly after moving.
- We will avoid Canadian mutual funds due to FATCA compliance.
- We will avoid setting up a TFSA account in Canada due to US tax treatment.

Is there anything else along those lines that will make filing our US and Canadian taxes easier going forward?
3
Hi J

You have quite a bit going on here so let me try and work through some of your questions:

In order to catch up on your late US returns you'll likely want to take advantage of the IRS streamlined tax filing program. This program, if you meet the eligibility criteria will allow you to catch up by filing the last 3 years of 1040 returns (including all related forms and disclosures) as well as 6 years of FBAR forms (foreign financial reporting forms).

You'll certainly want to plan for the money you intend on receiving. If you are the executor of your parent's estate it could result in a fairly complex final estate transition. Having a Canadian executor of a US estate may change the residency of the estate to a Canadian estate, thus requiring Canadian trust filings. This is something you'll likely want to avoid.

Considering you also have 401k and IRA accounts in the US you'll want to start consolidating your accounts. In most cases, especially considering US brokers either cannot legally manage the funds and that they have very little concept of Canadian investment and tax planning moving the accounts up to Canada is important. Give me a call at the number below and we can discuss your options for transferring the amounts up to Canada.

We do have the ability to transfer some of the IRA and/or 401k money to an RRSP, however in many cases this is unnecessary and you'll only be able to transfer up an amount close to your annual Canadian income.

As discussed above your parents should recognize the implication of having a Canadian executor of their estate. If this is the case they may want to change it to a US resident.

Please give me a call at the number below and we can chat more about your situation.

Cheers

Phil

4
US-Canadian Cross Border Investments / How to transfer my IRA to my RRSP
« Last post by Jsocks on January 05, 2019, 12:25:31 PM »
I posted something more general in the other forum. But I have something more specific to ask. I've done some research online about how to transfer my IRA to an RRSP. It kind of makes sense, but some things are not making sense:

- do I have to tell my IRA provider that I'm moving to an RRSP.
- can they transfer it directly?
- Is there a maximum I can transfer each year?
- I only have $20,000 of RRSP limit room
- can I also transfer my ROTH into the RRSP?

Thanks
5
US-Canada Tax Questions / Late US tax returns for Canadian
« Last post by Jsocks on January 05, 2019, 10:11:25 AM »
Hi

I'm in quite a mess and need some advise. I moved to Canada over 10 years ago from California and haven't filed my US taxes since that last year leaving. My wife is Canadian only and doesn't need to file US returns. I need to catch up on my late US tax returns for a few reasons.

I'll be receiving a rather large inheritance from my parents in the coming years and need to ensure I have planned properly and will not pay too much tax, or make any bad decisions with the transfer.

I also have investment accounts in the US that I need to transfer up to Canada. Those being 401k, ROTH IRA and regular IRA accounts, all with fidelity. my questions follow:

how to i get fully caught up on my US tax returns? I read the amnesty program has expired.

should i transfer my US accounts to Canada? Can I transfer them to my existing RRSP?

Do my parents need to know anything before I receive my inheritance? some of the money is also in IRA accounts.

Is there anything else I'm missing?

J
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US-Canada Tax Questions / Re: Receiving inheritance form the US
« Last post by jrousseau on December 12, 2018, 07:21:53 AM »
It's simple. You're the US citizen - fill out the W-9, you may use the IRS print https://www.irs.gov/pub/irs-pdf/fw9.pdf or something from the third-party sources with e-filing features: https://w9.pdffiller.com/ And it would be better if the form has been issued to you by the fund
7
US-Canada Tax Questions / Re: Canadian National
« Last post by Phil Hogan, CPA, CA, CPA (Colorado) on December 01, 2018, 10:58:57 AM »
Hi Martin

The use of LLCs in the US are common and they can work really well for US residents. However they are much less beneficial for Canadian residents and carry significant risks.

In most cases, for US purposes LLCs are considered partnerships. The income from the LLC flow through to the members or shareholders automatically. For Canadian purposes the LLC is considered a corporation. This difference in treatment can significantly affect Canadian taxpayers and often can result in double taxation.

Would your US partner be ok with using a US limited partnership instead of an LLC. Also, now that the US tax rates have dropped to 21% the use of a C-corp in the US (assuming you have a Canadian corporation) may be a good option as well.

Phil
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US-Canada Tax Questions / Canadian National
« Last post by martinerlic on November 28, 2018, 05:26:53 AM »
I am considering opening a US LLC to conduct business the States. My business is currently Incorporated in BC. My business partner is a US National. What are the cross-border tax implications for me as a Canadian National if I were to operate under the LLC instead? I will not be moving to the US.

I have been doing a lot to research in this area and it seems as though there is a possibility of double taxation for both my personal income and dividends. I would like to consult with somebody in Victoria as soon as possible.
9
US-Canada Tax Questions / Voluntary disclosure
« Last post by Staff on November 21, 2018, 08:21:24 PM »
So I think I messed up big in previous tax years and I am looking to remedy that, but before I
submit a voluntary disclosure request, I wanted to make sure I actually did mess up.

Here's my background - in 2015 I left my job in Canada and was employed in the USA for what I
thought would be a permanent job, and crossed the border on a 3-year TN authorization. That job did
not work out, and I returned to Canada in late December, 2015. I was employed in Canada on a three
month contract from January 2016 to March 2016, at which point I took another position in the USA
using another 3-year TN authorization. I kept that job from April, 2016 through mid 2017, at which
point I again returned to Canada.

I filed my taxes during this time in both the USA and Canada, but I honestly neglected to include
my USA income on the Canadian returns as I did not think I was a resident of Canada. I am now
questioning that decision, and want to file a retroactive determination of residency to the CRA for
the 2015 and 2016 tax years to see if I should submit a voluntary disclosure request for the income
from those years.

So my question is this - if I submit a determination of residency before my voluntary disclosure
request, am I at risk of being flagged for an audit, thereby removing potential of penalty relief under the voluntary disclosure
program? any and all advice is
appreciated.
10
US-Canada Tax Questions / Cross border tax services
« Last post by Staff on November 21, 2018, 08:14:41 PM »
Hello,
I am contacting you regarding your US and Canadian cross‐border tax filing services. I am a pretty simple case and I have
all of my documents. I will include my details below.
‐I am a United States citizen and became a Permanent Resident in 2017.
‐I started working in Canada in June of 2017.
‐I have only one T‐4 to file.
‐No additional Canadian or U.S. employment income.
‐I do not own a home in Canada.
‐No children.
‐Health care coverage through Blue Cross and Blue Shield of Canada while waiting for work permit.
‐Married. My husband is a Canadian citizen and has two T‐4ís.
‐I did sell my home in the States in December of 2017. My profit was less than $10,000 from the sale of my
house.
‐I have a chequing and savings account in Canada.
‐I also have a checking and savings account in the U.S. No investments in the U.S.
‐No other investments to report.
Would you be able to assist in filing my US and Canadian taxes? If so, how much would it cost to file my US taxes and
Canadian taxes?
Thank you for your time.
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