So, I figure there's a few Canadian-American newbies going through filing for the first time as married, with income in both countries, and I can't be the only one that finds the IRS more confusing than immigration.

So here's an open thread where we can collect experiences. I'll start off with a couple questions:

U.S. Taxes:
1) C. has to file U.S. taxes, obviously. He has income earned in Canada before he moved down here, and income earned in the U.S. since he moved down here. Do we count his income earned in Canada as part of his adjusted gross income? If so, what do we do about the exchange rate?

Canadian Taxes:
2) This is sort of dumb, but now that we will file as married, will my income earned here count as income for him on the Canadian tax forms?

Any suggestions on software or forms or a link to a walkthrough would be much appreciated. I've read through the threads here, and am desperately in need of the process being explained in simple English.

I would suggest TurboTax, it is simple and can handle most scenarios. And no, you don't list the Canadian income with the U.S. income. The Canadian gets listed under foreign income and is not taxable if under ~$65k (can't remember the exact figure).

TurboTax can handle foreign income? Awesome. (Always used an accountant or did it myself just with the forms.)

Yes, it handles foreign income on U.S. returns, but it doesn't have the forms for CRA if that is what you need. You will have to buy the Canadian version of Turbo Tax, which I think exists.

U.S. TurboTax


TurboTax Canada

The reason I like this program is you can electronically file your returns for a nominal fee, they are user friendly, and you don't have to be a tax wiz to follow along. Just hit the next button and the program walks you through all the different types of income and deductions and you answer 'yes' or 'no.'

I've been doing my taxes with turbotax for the past 2 years, it's wonderful

I hate tax season

As per my conversation with a very knowledgeable CRA employee, you file with the CRA for Can. Income earned, and with the IRS for US income earned, they cannot be on the same tax return, simple as that. Now, if you made Canadian income while living in the US (such as working for a Can. company, getting paid in Can. funds) then you would still have to file with the CRA. She told me that one currency earned is only applicable to THAT specific country. I would call the CRA & ask to speak to someone that is knowledgeable in this area just so that you know for sure. Good luck.

jen

when I filed my Canadian taxes for the last time in 2005, I was not asked for Jerry's income figures. (My return was done by a CPA).

Ya if the USA spouse isnt in Canada, one deosnt have to include them in ur Cdn taxes!! I called revenue Canada and they confirmed that!
If your using a computer program, sometimes one has to "trick" the program,otherwise it will include her for benefits!! For HER sin, I just used 000,000,000 and for her income I made up an amount, but was more than the minimum amount one could clam (if that makes sense--been awhile since I did this) I think that amount was around $12,000???? so I made it like 35,000, just to make sure the program didn't give me any benefits based on her! As well I included a short letter with my taxes stating I was married, my spouse is a USA citizen that has never resided/worked in Canada.

If you are married but living apart, for U.S. purposes anyway, you can file as head of household if you have a qualifying dependent. Just in case anyone is in this position...

I do not even think it matters for tax purposes (with the exception of a spousal credit) whether or not your spouse has income in Canada. In Canada you do not have the option to file jointly or seperately. You simple check off the box that says married. You would not include your spouses SIN because they obviously do not have one.

flames9 i need more info about putting ur spouse in canada income tax even not living with u in canada, what turn around does it make and how to do that

I was using a computer tax program (can't recal which one) if I had stated when asked that her income was ZERO, the tax program would have made her eligible to receive certain tax credits, which of course she/we are not entitled too. So when it asked for her income I just put down $35,000, thus not being entitled to any benefits! And I explained that in the letter I attached

thanx for ur respond am using computer tax program now QUICK TAX but it ask if am married, and i said yes, do i still have to mail them any information to proof that am married, cos in electronic tax filing u dont have to mailing anything just send it elctronically

If you check married, the CRA forms require that you provide your spouse's SIN, which I am assuming they do not have one. You can check married and leave it blank and include a letter of explanation why the spouse has no SIN, but for electronically filing, the return will be rejected. You will have to file hard paper to get around that.

I used a tax program, and yes could not file electronically, I had to print it off and mail it in!

oooooooo thanks for the links lol, my family can finally stop paying a useless accountant to fill out like 5 lines for 50/person

As a point of clarification, if you are filing as a US resident (Form 1040), you are taxed on your WORLDWIDE income (US plus Canadian wages). However, you do receive a tax credit for any foreign taxes (i.e. Canadian taxes) you paid on your Canadian wages. This is just how the IRS treats your foreign sourced income. I do not claim any knowledge of how they do things in Canada.