My plan for Canadian TN to USA

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starko
Posts: 1
Joined: Sun Mar 20, 2011 9:07 pm

My plan for Canadian TN to USA

Post by starko »

Wife is staying behind in our home in Canada to continue working and will occasionally visit. I would frequently visit her.

Aiming to maintain Canadian residency for tax purposes and am OK paying the additional tax not covered by FTCs on the Canadian T1. In this case, I'm assuming I file a 1040NR and a 8833 citing the correct treaty sections to assert my Canadian residency despite meeting the usual conditions for US tax residency (183 days, etc). Canadian-side, business as usual with the T1 except for the declaration of foreign income and usage of foreign tax credits (US tax + FICA) to kill most of the tax.

Does claiming both 7a (self) and 7b (spouse) exemptions on the 1040NR have any effect here? Also assuming no need to file 8891 (RRSP) or 3520 (TFSA). Would I still need to disclose all foreign accounts/trusts via TD90-22? I'm guessing no...

I'm assuming under this plan that I would be able to
a) continue to contribute to RRSP as usual
b) contribute/withdraw TFSA without being subject to US taxation

Anyone have experience with how long can I file a 1040NR before the IRS starts to push back?

Thanks.
nelsona
Posts: 18680
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Using the treaty to file 1040NR instead of 1040 does NOT absolve one of FBAR requirements.

8891 is not required for tax deferral, of course, since you would only be reporting US-sourced income. However, inasmuch that 8891 replaces form 3520 for RRSPs, and it is unclear whether 3520 is required of those using the treaty to file 1040, I might be tempted to simply file 8891 in any event.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
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