Cross border commuter taxes

pran · Post by **pran** » Sun Jan 17, 2016 10:59 pm

I am a cross border commuter (Canadian citizen on TN visa) working for an US company and living in Canada (almost 65%).
My wife is working in Canada. My employer deducts all taxes (federal, state,social security and medicare).
I plan to file US taxes as non-resident (single but filing separately) and Canadian taxes as resident.
I also contribute to my employer's 401k.

1) What forms should i use to file US returns?
2) How is my social securty and medicare treated in my canadian tax returns? Are they treated as tax deduction?
3) Is my 401k contrbution and employer's contribution tax deuductible on Canadian tax returns? if yes, I have very little rrsp contribution limit left, would all my 401k contributuion be allowed or is it subject to my rssp deduction limit?
4) Do I have to file FBAR or FATCA even though I am a non-resident of US?

Please advice.

nelsona · Post by **nelsona** » Mon Jan 18, 2016 8:10 am

1. your 1040NR should be filed MARRIED filing separately. That is your only choice for 1040NR.
2. FICA taxes are foreign tax credits.
3. Your 401(k) is deductible, but only against your limit
4. No

pran · Post by **pran** » Mon Jan 18, 2016 10:54 am

Thanks Nelsona.

1) I believe my 401k contribution (not my employer's contribution) is subject to my rrsp deduction limit. If I overcontributed to 401k (more than rrsp limit), will there be a penalty? what are the consequences?
2) Are my travelling expenses (flights, taxi fare, lodging, meals, etc) tax deductible in USA and Canada?

nelsona · Post by **nelsona** » Mon Jan 18, 2016 11:47 am

1. There is a from on the CRA website that will calculate your limits. There will be no penalty of your 401(k) puts you over your limit; instaead you will simply not be able to deduct the full contribution.

2., No they are not deductible. You are en employee choosing not to live near your work.

pran · Post by **pran** » Mon Jan 18, 2016 11:55 am

Thanks Nelsona.

1) I believe the form is RC268. My employer's 401k contribution is not fully vested until I work with them for atleast 2 years.
In RC268 form, for my employers's contribution should I include all my employer's contribution or only the vested amount?

2) Please let me know if you have any tax tips for me.

nelsona · Post by **nelsona** » Mon Jan 18, 2016 7:50 pm

1. Yes. This is to determine your PA.

2. YEs. Don't contribute to RRSP while working in US. Also, look at doing an XXV(2) return. Several posts on that. And don't fund Roth or Roth401(k) while living In Canada

pran · Post by **pran** » Mon Jan 18, 2016 9:03 pm

Thanks nelsona.

My employer's 401k contribution is not fully vested until I work with them for atleast 2 years. In RC268 form, for my employers's contribution should I include all my employer's contribution or only the vested amount?

nelsona · Post by **nelsona** » Tue Jan 19, 2016 8:47 am

Answered already: yes.

Asheron · Post by **Asheron** » Thu Feb 04, 2016 7:23 am

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Asheron · Post by **Asheron** » Thu Feb 04, 2016 7:24 am

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