Moving to the US

escabeche · Post by **escabeche** » Mon Aug 15, 2016 10:04 am

I got an job offer from an American firm and am moving to the US in about a month, however, my wife will stay in Canada until the end of the year before joining me.

For investments, my wife and I have non-registered investment accounts, RRSP, and TFSA. We also own two condos in Canada, one of which we are currently living in and will be rented out. The other one is a home for my in-laws.

I called both CRA and IRS already. Since my wife is staying in Canada and I am moving towards the tail end of the year, I am considered a Canadian resident, and a non-resident alien in US for 2016.

Three things that get a bit confusing for me in terms of how I treat my taxes in both countries:

1. In the early part of this year, I worked as a remote contractor via my sole proprietor business. So I have some income for a US company while I was living in Canada.
2. My investment accounts holds mostly US companies, I guess that would be considered part of US income for IRS purpose for 2016? Do I need to report capital gains and dividend income for the entire 2016 for IRS, or only after my move?
3. Since I am considered a non-resident alien for 2016, does that mean I should withdraw my TFSA, switch my non-registered investment accounts over to the US on Jan 1st, 2017 instead of when I move? What is the best way to minimize double taxation and potential headaches down the road?

Finally, should I just hire an accountant? :)

Thanks

Steve

nelsona · Post by **nelsona** » Mon Aug 15, 2016 11:19 am

First, don't taje advice from CRA on what your US tax status is. Even if you are non-resident (because you do not meet SPT, etc) doesn't mean that you would not benefit from filing a 1040 AS IF you were a US tax resident. Much depends on the time of year you move, what income you and your spouse have before and after the move, etc.

In any event, it seems clear that for 2017 and forward, you will be filing a a regular 1040, even if you do not for 2016. That means getting rid of TFSA by January 1. If you can get rid of it before moving, all the better.

To your specific questions:
1. This is not considered US income, since you were physically in Canada.
2. This would only be considered US income when you live in US.
3. TFSA should be closed asap. transfers of other investment s to US broker should be done asap as well. It is not a tax issue, it is a regulatory issue. All your holdings, wherever they are held, will be subject to Cdn deemed departure tax when on your departure date.