I immigrated to Caligfornia since last July from Canada. Is there someone here who know how to report Canadian and US tax? Thank You!!

you will proably have to file both returns - especially if you earned income in the US. if you were in Canada for 183 days, you will be a deemed resident and will only pay taxes to Canada. when you file your US return, include a copy of your CDN one and include a copy of your US return with the CDN. if you don't they will just ask for proof of filing in the other country. If you were not in Canada for the 183 days, you will be a non-resident and will complete that return accordingly. That way you'll get taxes paid back, only to owe them to the US. ccra site for more information http://www.cra-arc.gc.ca/tax/individuals/menu-e.html




k

Sorry Kimi.. but that's not exactly true... You'd have to file a leaving Canada return even if you left Canada on January 1...

There is plenty of information on the Canada Forum..

You will have to file two returns... The first is a Leaving Canada return from Canada.. you do this by placing the date that you left Canada on your T1.. You have to prorate your deductions to the time you actually were in Canada... but you only have to include your income that you made while you were a resident of Canada...

The second is that you will have to file a 1040 (probably jointly with your spouse) to the IRS. You can exclude your income made in Canada. You can exclude up to $84,000 of your foreign source income a year. The $84,000 would be reduced by the ration of days you were a resident of Canada and a resident of the US. If you get EI income in the US after you get here.. it gets a little more complicated but not insurmountable...

So give us some specifics about your information, and we'll try to help you...

Thank you so much for the professional answers. My situation is: I left US with visiting identity from the end of Jan. 2006 to the middle of July 2006. In the middle of July, for immigration interview, I went back Canada. After interview, at the end of July, I came back US with immigrate identity. I don't have any income in Canada in 2006. While I have income in US after I got SSN in 2006. I still keep my Canadian Driver license and health card (I was living in ON.). But I have canceled the bank accounts,credit cards in Canada. I don't have any property or loan in Canada. So for my case, What should I do?

Thanks again and have a nice weekend!

well, technically yes, but having assisted in preparing many tax returns for people leaving Canada (prepared by D&T), if you don't have CDN income for that year and don't file, you'll just get a request to from them & then you send in your foreign return to keep them happy.

and to the OP, having your Health Card doesn't mean it's valid. Once you are not employed in Ontario and aren't paying the $800/yr 'health care tax' or have residency there, if you do use it, you will be billed if you cannot prove residency.

File your 2006 tax return in Canada even if you have no income as it verifies the date you emigrated from Canada and immigrated to the US. You will not have to file a Canadian return for 2007. File your joint US tax return with your husband combining your two incomes and then claiming whatever deductions for which you are eligible. Your OHIP card became invalid when you left Ontario and changed your residence to the US. You cannot use it to claim any health benfits in Ontario - to use it would be considered fraud by the Ontario government as it is only for valid residents of Ontario.

You will also need to check what the Driver's License rules are for the State in which you now reside. Many require that you obtain a state license within 30 days of arrival meaning that your Canadian license may no longer be valid for driving purposes. You are better off having a US driver's license for identification purposes if you are legally residing in the US anyway.

Thank you for the answers.

1. May I know when is the date I left Canada whn I file the form of Determination of Residency Status (Leaving Canada), the date of Jan. I left for US withvisiting identity or the date of July I left for US with immigrate identity?

2. Actually, I am applying for the local driving license. I just keep my Ontario driving licence and health card. I didn't use them any more. Do I need to cancel them?

3. For the filing tax. if I file the Determination of Residency Status (Leaving Canada), do I have to file 2006 tax in Canada?

4. If I have to file tax of 2006 in Canada, do I have to file the income I got in USA in 2006?

Thanks again. Have a ncie weekend!

1. When you officially activated the visa allowing you to live and stay in the US which I believe would be your July date.

2. You can notify OHIP that you are no longer a resident. You don't need to return the card as it is no longer valid. You may be required to turn over your Ontario driver's license when you obtain your state license - I don't know if your state does that but Georgia does.

3 & 4. Yes, you will have to file a 2006 return no matter what. As long as you resided any part of the year in Canada - which it appears you were still a de facto resident probably until July - you are required to file advising CRA that this is your last year in Canada for which you are liable to pay tax as a Canadian resident. You do not have to declare income you received in the US after you left Canada for good - just income up until the date you left. Since you have no Canadian income it will make the return an easy one to prepare:-). You will, of course, owe no taxes and receive no benefits. It is really just 'tying up loose ends' paperwork.

Hope this helps.

Thank you. It is really helpful!
Have a nice weekend!

1) It's the date that you were no longer a resident of Canada.. they date that you left and had no intention of returning... in your case, it appears that that date is in July...

2) You do need to cancel your OHIP... you do this by filling out a form that's on their website...
Once you get your US Driver License, you can get a refund of the fees that you paid to Ontario for your DL... they form to get your money back is on the MTO website...

3) You do not have to file the NR-73 (Determination of Residency Status).. it is not a required form.. all you have to do is file your regular T1 with the International Tax Services Office and indicate the date you left Canada on the first page...

4) No... you do not have to report your worldwide income to the CRA.. you only report Canada source income on the leaving Canada return. However, you only get the standard decuction for time that you were actually in Canada. You'll have to prorate the amount of the standard deduction by the ratio of days that you were actually in Canada... If you lived in Ontario, you have to pay the entire OHIP surtax if you are liable for paying it... this is not prorated...

Thank you Zyggy.

According to your guys advise, I should file individual Canada tax in 2006 with Canadian income, And joint US tax in 2006 with US income. Is that right? When I file Canada tax, can I leave US mailing address or I have to leave a Canadian address?

I have to cancel Canadian Health card and driver license. Is that possible someday in the future I move back to Canada after I cut all the contact to Canada?


Zyggy: If I didn't file non-resident form, I might file Canada tax next year. Someone said after I file this form, I needn't file Canada tax any more. Is that right?


Thank you!

You have to cancel your OHIP once you are no longer a resident of Canada. You can send them the form. You do not have to go in and do it... Same for the DL...


Actually, you have to declare your Canadian income on the US 1040... but you can exclude it for the time that you were in Canada up to $84,000. This amount is reduced by the ratio of time that you were actually a non-resident alien living in Canada. So for July 1, it's $41,655. and $230.14 per day. Convert your Canadian income into US dollars. The exchange rate for 2006 is $1.134 CAD to $1 USD. You do this by filing a Form 2555 with your 1040. So you report the income, but then subtract it out a few lines later in the return... You do not have to report your US income on your Leaving Canada return unless you are filing what is known as a Partial Section 217 return. Which means that you are claiming a refund of some non-resident taxes that you paid on Canadian Source Income while you were no longer a resident of Canada. The most common time that you would do this is if you got EI income while you were in the US and want to get a refund on a portion of non-resident taxes that you paid.

When you file the Leaving Canada return, (placing the date that you left Canada on the T1 and filing it to the International Tax Services Office), you do not need to subsequently file a return to Canada unless you are either classified as a deemed resident, have Canada source income, or wish for a refund of some type of non-resident tax that you paid (Section 217). You file the Leaving Canada return using your US Address. You do not file the non-resident T1 for your Leaving Canada return. You use the T1 for the province that you lived in when you left Canada.

So, if a foreign spouse of a USC has been substantially present (7+ months) and had no foreign or domestic income for 2006, do you then just file as "married filing jointly" and claim only the USC's income?

Yes... if the foreign spouse does not have a SSN, you'll have to file a W-7 form for an ITIN with the return and file it to the International Tax Office in Philadelphia.

Thank you, Zyggy.

When I file the Leaving Canada return this year, I needn't file Canadian tax return next year and later. Is that right?

Actually, I don't have Canadian income in 2006. It seems I needn't declare it on US1040. Is that right?

Thanks again!
Have a good night

More questions:

1. Do I need file both T1 and Ontorio tax return?
2. I have no income in Canada in 2006, but I have Tuition fee deduction from previous two years (2004,2005) in Canada. Can I put in record in my Canadian Tax return? Can I use it in my US Tax return?
3. Do I need to calculate the refund in T1 because I hava no income in Canada in 2006?
4. Where should I mail my Canadian Tax return?

Thanks alot!

1. Yes.. you file the T1 for the province that you left... If you left Ontario in 2006, that's the one you file.

2. Sorry.. you can't deduct any education expenses from Canada on your US return, it has to be expensed in the US... If you took out student loans to pay for it, you can't deduct the student loan interest from a Canadian student loan in the US either...

3. Everyone who leaves Canada has to file a Leaving Canada return, even if they had no income in 2006... It makes sure that you have no loose tax ends when you leave, such as a tax penalty if you withdrew money out of your RRSP to pay for school and you didn't pay it back... or if you would owe any Ontario Health Premium at the end of the year (you have to pay the entire thing for the year when you leave, even if you left Canada on January 1)... etc...

4. International Tax Services Office, 2204 Walkley Road, Ottawa ON K1A 1A8

Thank you.!

1. I have no income in 2006 in Canada. When I file T1, generally I can get refund. Do I need to calculate the Refund and get refund?
2. Can I keep those Tuition fee deduction? For case I go back Canada sometime in the future, can I claim them then?
3. what is Leaving Canada return? Is that T1 General form with my departure time on it?

Thank you so much! Have a nice day!

1) You calculate your T1 as you normally would with some exceptions... the only difference is that put the date that you left Canada on the first page...A lot of things such as exemptions are reduced by the time that you were in Canada. I suggest that you take a look at The Tax Guide Emigrants and Income Tax from CRA before you submit your return...

2) You can apply any tuition and education amounts that were incurred during the time that you were in Canada against any Canada source income that you had. I believe that the time that you can carry them forward is 5 years. After that, no, I do not believe you will not be permitted to claim it...

3) A Leaving Canada return is a T1 for the province that you left with the date that you left Canada on the front page

Thank you!