Tax tor CRA with J1/H1B in USA

This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.

Moderator: Mark T Serbinski CA CPA

Post Reply
mayliszt
Posts: 3
Joined: Sun Jan 25, 2015 1:43 am

Tax tor CRA with J1/H1B in USA

Post by mayliszt »

Dear friends,

I am completely complicated by the tax issue. This is my case:

------Year 2011----------

Jan, 2011: I am Canadian permanent resident and working in Toronto.

July, 2011: I started working with a J1 visa in California, as a full-time research scholar. In USA, I am a so-called "nonresdient alien for tax purpose".

Since then, I do not have significant ties in Canada, except my bank accounts and two mutual funds. I rented in USA, bought car in USA, and lived in USA, worked in USA. The Canadian bank money generates may be $300 a year. That is my only Canadian income since I move to USA in July 2011.

Question: What is my tax residence for 2011? What income shall I report to CRA?

------Year 2012-----------
July, 2012: I became a Canadian Citizen, but still with a J1 visa in USA, still a USA "nonresidnet alien for tax purpose"

Question: What is my tax residence for 2012? What income shall I report to CRA?


-------- Year 2013 ----------------
Jan, 2013: I am still with a J1 visa, but USA started consider me as "residence alien for tax purpose"

Sep 2013: I got H1b Visa in USA, the same job.

Question: What is my tax residence for 2013? What income shall I report to CRA?


I have been so confused. I have not sent the NR73 form to CRA, because I am completely confused.


Thanks in advance.
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

You became non-resident of Canada and tax resident of US the day you got H1-B.

You file as an emigrant for 2104 in Canada, with H1-B date of departure.
Please read many posts on EMIGRANT filing for CRA>

In US you may choose to fiule full-year 1040 now, no longer have to use 1040NR.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
mayliszt
Posts: 3
Joined: Sun Jan 25, 2015 1:43 am

Post by mayliszt »

Thanks. Why cannot I be counted as an emigrant since 2013, when I became a US "resident alien for tax purpose", though still J1 visa?

In 2013, from Jan to Dec., I have been charged full tax in US.
My US tax form from employer has the info:
Residency Status Change Date: July 03, 2013 to Resident Alien
Residency Status Start Date: January 01, 2013 to Resident Alien

If I am still a Canadian resident in 2013, I was double-taxed in 2013, from Jan to Dec.

CRA website says: "the date you become a resident of the country you settle in."
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

I said you could emigrate the day you got H1-B. Sorry I mistyped 2014 instead of 2013. How did you file in canada in 2013? It should be as a departing resident in July/Sept timeframe.

Under j-1 you would not be considered resident until AFTER your 2 full years in US under j-1 (that would be July 2013) and if you met 183 days in 2013 (which would also be July 2013). That puts you about the time of H1-B.

You are free to CHOOSE Jan 1 2013 for 1040 filing purposes, but that doesn't mean that you are resident in US for treaty purposes, which is how you would be claiming non-residency in canada.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Even as J-1, you were still taxable in US on all your US income. Did you not report your income to IRS (and CRA) for 2011 and 2012?

And you still would never be "double-taxed", as you would simply claim foreign tax credits for the US income you had to report on your Cdn return, just like you would have done in 2011 and 2012.

PS. Since the employer presumably accurately determined your residency start date as July 3, that becomes your departure date from canada.
Most get H1-B before their J-1 exemption goes away.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Never send an NR73 to CRA unless they ask.
Simply put departure date on retunr and fillow the CRA emigrants guidelines.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
mayliszt
Posts: 3
Joined: Sun Jan 25, 2015 1:43 am

Post by mayliszt »

Thanks, Nelsona!
Your answer is the most clear an detailed I have received. I have looked around, and your answer is the best. Thank you so much!
nelsona
Posts: 18314
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

I'd be curious where else you looked around.
I refer all from canuckabroad to here. I don't know of any other US-canada cross border forums.
If there are sites that you are posting to and getting incorect answers I'd like to know, so I can put them out of their misery.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
Post Reply