Serbinski Accounting Firms

After double-checking, the previous post doesn't seem accurate, we don't multiply annual difference in depreciation by tax rate:

To adjust:
It’s even more interesting when annual amount x your marginal rate
• FMV Step-up Difference: $300,000
• Annual Difference: $300,000 ÷ 30 = $10,000
• If your ...

To adjust:
It’s even more interesting when annual amount x your marginal rate
• FMV Step-up Difference: $300,000
• Annual Difference: $300,000 ÷ 30 = $10,000
• If your marginal tax rate = 24% → Tax saved = $10,000 × 24% = $2,400
Since $2,400 < $10,000 → 8833 not required.
You don’t just compare the ...

Hello,

Sharing more details about form 8833 for mandatory disclosures of treaty-based positions. (still for a rental basis of a Canadian residence)
Just a look at this form and a talk with chatGPT that gave several non-correct answers, made me check the regulations on the requirement to file or not ...

Thank you very much for sharing. It's always interesting to know how things will unfold in practice when two countries share a regular taxpayer's money in hope to benefit some crumbs from this dispute. This MAP will most probably cost more than the profit it will generate for either party.

Your ...

I've been trying to find an IRS publication on how to depreciate a foreign property. It most probably doesn't exist. While looking, I came across a reference to section 168 of the IRS tax code. When I looked at this section, it seemed not exactly something I looked for because of the way the ...

If you also have an on-going rental in the US, and not only for some months you are at work there, you have a permanent home in both countries. Your vital interests are in both countries. While you spend almost the same amount of time in both countries, the term "habitual abode" includes not only a ...

Thank you very much, it will definitely save my time not to look for a specific IRS rule.
It's a smart decision to include form 8833 for any treaty position just to avoid guessing in what case its use is mandatory.

Thank you very much!

Yes, I also noticed that the change-in-use must be declared on the Canadian side to make things work for the IRS, thank you very much for confirming.

If your change-in-use occurs sometime after your departure from Canada, the election XIII (7) will step-up the basis of your ...

Hello,

After reading many posts, I’m still not sure if my understanding is correct.

When you leave Canada owning a Canadian principal residence at the time of your departure, you (a Canadian citizen only) will have a natural step-up of basis to FMV at the time of departure without reporting any ...

If you’re a tax resident of both countries, there’s a tax treaty between them that will determine the country of your tax residency.
US internal rules for tax residency are quite easy to understand, they are objective; once the conditions are met, you become a tax resident.
Canadian internal rules ...

Thank you very much for the answer.

I don't think that I got the right answer from CRA. The agent didn't seem sure. I asked about the penalty if T1243 with 0 capital gains is not filed. According to the agent, no penalty is assessed.

I don't think that there's any obligation to file this form ...

Hello,

I'd like to know if someone has ever been questioned by CRA if your car was listed in 1161 but as a reasonable person you didn't file T1243 with the same car on it? You don't have any capital gains on the car and no capital losses for this type of property are accepted.

A closer look at ...

Thank you very much for the information!

Thank you, good to know!

I thought that probably in several months from the date of the submission, I would be able at least to check the status of my return where I would read "accepted".

If it doesn't work this way, I would probably be able to use a copy of 1040 and an amount credited by IRS as ...

I haven't filed yet as the deadline is still a couple of weeks away. My intention is to proceed with FEIE as it gives me a better refund than foreign tax credits. Even if my tax return is accepted, I won't be able to confirm that this method actually works as not all the tax returns are audited. If ...