Filing Bankruptcy in Canada - Affect on US Credit or Immigration?

[Udella&Wiz 325]

Just remember you're young - you have plenty of time to get debts paid, it seems deep to begin with but it can be suprising how much you can chip away. Honouring your debts is always the best policy.

Oh no I would never run away from any payments! That's why the past year has been such a struggle, not being able to work. Before when I worked, I still had all the debt, but I made all my payments on time and had good credit. We never had plans to stay in the US until DOMA was passed, or else I would have dealt with this before I left for sure, or tried to. Now my wife is using her paychecks to pay off my bills and honestly it makes me feel like total garbage. I know she says she doesn't mind and we share our finances etc but it still makes me feel bad, especially right now when I can't contribute and haven't been able to for 8 months+. That's the only reason I was even looking into it, to take some stress off her.

My student loan is: 9K (But it's under repayment assistance, so I don't have to make payments for now if they keep approving me.)

My student line of credit is: 15K

One credit card is: 2.5K

Another credit card is 3K

and then on top of all our other US expenses.

To me, right now, in my current situation, I guess those numbers seem really scary and depressing. I don't think I'd ever buy a 24K car, to be honest

[NikLR 13,234]

Took me 10 years to pay off my student loans but I got it done. Even if you send them $50 a month or $100 a month, that's better than nothing. Now I am actually planning on doing it again here in the USA but with a field of work that pays more and isn't my hobby. Should get those loans paid off a lot quicker this time!

[Erica & L 52]

Update: I spoke with Debt Canada and they told me they could help me with my credit cards, basically I'd be paying the same amount I usually pay but with 0% interest so they actually get paid off.

My student loan through the government can't be consolidated so they said to keep reapplying for repayment assistance.

My student line of credit can't be helped either because my uncle is a co-signer and putting me on any sort of payment plan could hurt his credit and I don't want to do that. So to keep making my payment.

So basically, that's all I can really do at this point. I guess it'll have to do until I can get my EAD.

[Erica & L 52]

Oh, and that even if I wanted to file for bankruptcy, there wouldn't be a point because I could only file for my credit cards, not the SLOC or loan.

[NikLR 13,234]

At least you know. Just as an fyi, it may have taken me 10 years to pay off my student loans and they both went to collections, but I left Canada with fantastic credit, so making those payments, helps!

[Udella&Wiz 325]

Good job on taking positive action! That is awesome that you can get 0% interest.

Update: I spoke with Debt Canada and they told me they could help me with my credit cards, basically I'd be paying the same amount I usually pay but with 0% interest so they actually get paid off.

My student loan through the government can't be consolidated so they said to keep reapplying for repayment assistance.

My student line of credit can't be helped either because my uncle is a co-signer and putting me on any sort of payment plan could hurt his credit and I don't want to do that. So to keep making my payment.

So basically, that's all I can really do at this point. I guess it'll have to do until I can get my EAD.

[Erica & L 52]

Yeah it's better than nothing! At least it'll feel like I'm actually making a dent in the amount

I got my NOA text and emails today too and I know I still have a long way to go but any progress towards getting my EAD and being able to work is good news!

[Udella&Wiz 325]

Start polishing that resume and LinkedIn if applicable. I checked out place I might like to apply while I was waiting. Gave me something to do between playign video games and making supper.

Yeah it's better than nothing! At least it'll feel like I'm actually making a dent in the amount

I got my NOA text and emails today too and I know I still have a long way to go but any progress towards getting my EAD and being able to work is good news!

[dotti 0]

My questions involve both Ontario, Canada and California, USA.

I am a non-resident Canadian citizen, worked in USA under TN VISA since 2007, married my hubster (American) and became a permanent resident in USA last year.

I had lived and worked in Canada for 10 years before I relocated to USA in 2007. I have worked on and off in USA since 2007. I continued to pay Canadian tax until 2011 when I lost my job in USA and declared non-resident status with Canada at that point. CRA determined I still owed them tax at that point. I have not received any unemployment or support from USA or Canada since 2007. When I wasn't able to attend to my affairs in 2011, my doctor provided CRA a letter to plead for leniency. Since then I have only filed tax in USA and not in Canada. I lost track of CRA's decision as I had been moved in and out of care and am not sure if they still deem me owing taxes.

Now over that period of time, my broker in Canada failed to manage my investment and lost about CAD$100K. I still have assets in Canada (both RRSP - a form of 401K in Canada and my own money) and in USA. My questions are:

1. Can I move my RRSP/retirement money from Canada to USA without paying penalties in Canada?

2. The investment account with the brokerage in Canada is money I borrowed to invest and is owing ~CAD$40K. I have been paying interests on that loan since 2006. Now our house in USA is under the water and we need to move my assets from Canada to cover it. if I move all my remaining assets in Canada over to USA and declare bankcruptcy on that owning of ~CAD$40K, is it doable? Or they will withhold my Canadian assets? How do I get my remaining assets out of Canada unscathed? I felt taken advantage of by the Canadian brokerage cuz they neglected my investment when I moved away and just took the fees. What can be done legally possible to minimize my loss?

3. If I declare bankcrupcy in Canada, would the government/CRA go after my assets/credit or my husband's assets/credit in USA?

4. Our plan is to split our time in USA and Canada when retired (my husband is an American) - is declaring bankcruptcy in Canada or owing CRA taxes gonna jeopardize our social/retirement/senior benefits in both countries? If there is any tax owing determined by CRA from past years, would it cause damage when we retire or for him to apply for Canadian citizenship?

5. If we don't declare bankruptcy, is there any way to use the $100K investment loss with the Canadian brokerage as a write-off either in Canada or USA? I have never used that as write-off for either Canadian or American filing,

We'd also appreciate if you know any CPA, law firm that can give us suggestions.

Thank you,

Dotti

[Udella&Wiz 325]

I would ask the expert in the Serbinski tax forum - this one is specifically geared to Canada/US tax questions.

I am 99% sure the answer to #1 is no - you are allowed to withdraw a locked in RRSP when you are a deemed a non resident by Canada but you will pay taxes on the withdrawl....I believe to the tune of 25% + (I had gotten that answer from the Serbinski tax forums for myself recently - don't quote me on the % ).

http://forums.serbinski.com/viewforum.php?f=2

I would say that if you've been gone longer then 7 yrs from Canada your credit rating in Canada may be zero anyway so you'd be starting from scratch in Canada, declaring bankruptcy won't make it any worse other then that will be on your record for 7 yrs I think.

What social/ retirement/seniors benefits are you thinking you'll be entitled to if you moved back to Canada? With your husband not being a Canadian citizen he isn't likely entitled to anything in Canada and depending on how long you worked in Canada before moving to the US - you may or may not be eligible for Canada Pension either.

Edited June 8, 2015 by Udella&Wiz

[dotti 0]

Thanks Udella & Wiz.

I had worked in Canada for over 10 years before I came to USA - if so, at least for me, am I still eligible for Canada Pension?

In terms of social/ retirement/seniors benefits we are thinking we might be entitled to if we move back to Canada, we are thinking if this USA healthcare reform didn't pan out, we can always go back to the Big Old White

We were planning to apply for husband's Canadian citizenship. But with the financial situation and all these ... that's why we want to find out.

[Udella&Wiz 325]

That doesn't necessarily mean you're eligible for CPP - I worked/contributed for 19 yrs between 18 and 37 and I am a couple periods short of being eligible for CPP (think I need to work for 6 more months in Canada or something similar) so you may want to check out the eligibility rules, don't assume you're eligible.

I am trying to find the details or a link on ServiceCanada but you can probably google

Anyone else have them handy? If I'm wrong or the rules have changed?

Thanks Udella & Wiz.

I had worked in Canada for over 10 years before I came to USA - if so, at least for me, am I still eligible for Canada Pension?

In terms of social/ retirement/seniors benefits we are thinking we might be entitled to if we move back to Canada, we are thinking if this USA healthcare reform didn't pan out, we can always go back to the Big Old White

We were planning to apply for husband's Canadian citizenship. But with the financial situation and all these ... that's why we want to find out.

Edited June 8, 2015 by Udella&Wiz