Canadian on TN visa in the US - residency status?

[stormy]

This has been an incredibly helpful resource, so I'd like to express my thanks in advance!

I'm a Canadian who moved to the US on a TN Visa in early 2009, and need some help with my first US tax forms! I pass the substantial presence test for 2009, and have no primary ties to Canada, but still had my Canadian driver's license and health card in my possession (although I used neither in 2009). I also kept my Canadian bank accounts and credit card (that I did use during trips to Canada in 2009), and let my statements continue to be sent to my last address (my parents' place) in Canada. I also gave my parents' Canadian address for my Canadian 2008 tax return even though I was already in the US at the time it was filed in Apr. 2009. Although I had no Canadian employment income for 2009, I was earning a very small amount of Canadian bank interest income and have a (minimal) RRSP. I plan on cutting off these remaining secondary Canadian ties this year. My questions:

1) Considering my secondary ties to Canada and the fact that my initial visa was good for one year only (last month (ie. 2010), I reapplied for a new one good for the max 3 years), would I still be considered a Canadian resident and a non-resident alien in the US for the 2009 year? or is my US employment and residence (+ US bank account and US credit card) sufficient for a resident alien status for 2009?

2) I still have unused education credits in Canada - any way I can use them?

3) my state requires health insurance by law. It took a couple months for my work-sponsored health insurance to kick in so I was uninsured for my first months in the US. Would I be allowed to say I had coverage by Canadian health insurance for those months?

Thanks again for any help!

[nelsona]

1. You are Cdn NON-resident from when you left, and should file departure return. You can file full year 1040 reporting world income.

2. If you go back to Canada at some point or otherwise have to file a Cdn return.
3. Not unless you made specific arrangements with province to keep your cobverage; it stops the day you left. Unless you bought blue-cross for the period before your firm's covergae came in , you were not covered.

[stormy]

thanks for the clarification and quick response, your help is greatly appreciated!!

[stormy]

Hi Nelsona,

Sorry to bring this back up again, but I forgot to mention that I am not married. You said that I can file a full year 1040 reporting world income, but I just read that dual status aliens cannot choose to be treated as a US resident for the entire year if they are single. So this would mean that I have to file both the 1040 and the 1040-NR (as a statement to show income during the period I was a non-resident)? - is this correct? Also, I don't believe this changes things but I should correct a previous statement I had incorrectly made about not having any Canadian employment income for 2009. I had in fact earned income at the end of 2008 but did not receive it until 2009 (but I received it before moving to the US).

Thanks once again!

[nelsona]

You are using the treatry, not IRS rules.

[stormy]

If I am using treaty to be able to file a full year 1040 (using form 2555 to exclude foreign earned income) instead of dual status, would I also need to file form 8833 to disclose this position? I've tried looking around and seem to find that form 8833 is usually filed with 1040NR, which isn't my case. If I have to file form 8833, I know that I would put Article XXV(1) for line 1b, but what would I put for line 2 ("List the IRS provision(s) overruled or modified by the treaty-based return position")?

Thanks once again!

[nelsona]

no need to fill second line.

8833 is not usually required for 1040nr, since the form itself contains all the necessary questions about treaty.