Non-Residence Status?
Moderator: Mark T Serbinski CA CPA
Hi nelsona,
I'm a little bit confised here. You are saying that
"3. Even if you were legitaimately a DNR, the method in which you filed was NOT proper.<b> DNRs MUST report every penny they make</b>, and THEN request deduction for their specific foreign income. You simply chose not to report it."
but on the CRA web cite they are saying that
"You may be a deemed non-resident for tax purposes if you're otherwise a deemed resident of Canada who, under a tax treaty, is considered a resident of another country.
<b>As a deemed non-resident, the same rules apply to you as a non-resident of Canada</b>."
It seems to me that being a DNR I do need to report the income that I've got in Canada only. And therefore I do not need to request any deduction for mine foreign income as I simply shall not file it in.
I just wander if my understading is correct?
I'm a little bit confised here. You are saying that
"3. Even if you were legitaimately a DNR, the method in which you filed was NOT proper.<b> DNRs MUST report every penny they make</b>, and THEN request deduction for their specific foreign income. You simply chose not to report it."
but on the CRA web cite they are saying that
"You may be a deemed non-resident for tax purposes if you're otherwise a deemed resident of Canada who, under a tax treaty, is considered a resident of another country.
<b>As a deemed non-resident, the same rules apply to you as a non-resident of Canada</b>."
It seems to me that being a DNR I do need to report the income that I've got in Canada only. And therefore I do not need to request any deduction for mine foreign income as I simply shall not file it in.
I just wander if my understading is correct?
Although a person also uses the general return if they are a U.S. resident (Canadian non resident) with employment income from a province (eg. U.S. resident cross border commuter to employment in Canada). In this case they use the general return for the province where they earned the employment income even though they are a non resident. The only income indicated on this return would be the Canadian employment income as everything else based in Canada (interest earning Can. bank accounts etc.) would have had appropriate non resident tax withheld.They also would NOT report ANY U.S. income.on this type of return However, this situation likely does not apply to the poster above. I am wondering what this person put on their Canadian return since they say they filed a Canadian return each year. Was it a zero return? Will CRA accept a zero return? I would not think they would. Would look to me like someone trying to ensure the returns get statute barred in 3 years by having CRA accept the return as filed. If this person filed a general return with a Canadian address then I would think they were saying that yes, they are a Canadian resident and then indeed would need to include U.S. (worldwide) income. Also, I wouldn't think it "really" mattered which return (general, non resident) one used as long as it was completed correctly. Using the correct return form simply, I believe, helps ensure that it gets completed correctly since each form directs certain things to be filled in (eg. fed. surtax for non residents on some types of income).
I Know that Nelson is aware of all this so I am not posting this to correct his reply, just to provide more info.
The advice to contact a (cross border?) tax attorney is good advice.
I Know that Nelson is aware of all this so I am not posting this to correct his reply, just to provide more info.
The advice to contact a (cross border?) tax attorney is good advice.
Depends what you meen by "dual-status".
In US, in the year you arrive, if you arrived there after January 1st, and were a non-resident before arriving and a resident at some point after arriving, then you can be dual status.
By the way, if you did not meet SPT or get Green Card in a given year you are not considered a US tax resident for that year. That is why there is the first-year CHOICE to be considered a resident. Since you arrived late in 2004, you could not have been considered a tax resident by SPT. You would only have been allowed to file a 1040 in 2004 (instead of a 1040NR) if you made a written CHOICE as outlined in IRS Pub. 517.
Canada doe not have such a choice, but it does have arrival and departure dates. If you left in Novemeber, and were a non-resident thereafter, you should be indictaing this on the return for the year you left, not CHOOSING some other date.
<i>nelsona non grata... and non pro</i>
In US, in the year you arrive, if you arrived there after January 1st, and were a non-resident before arriving and a resident at some point after arriving, then you can be dual status.
By the way, if you did not meet SPT or get Green Card in a given year you are not considered a US tax resident for that year. That is why there is the first-year CHOICE to be considered a resident. Since you arrived late in 2004, you could not have been considered a tax resident by SPT. You would only have been allowed to file a 1040 in 2004 (instead of a 1040NR) if you made a written CHOICE as outlined in IRS Pub. 517.
Canada doe not have such a choice, but it does have arrival and departure dates. If you left in Novemeber, and were a non-resident thereafter, you should be indictaing this on the return for the year you left, not CHOOSING some other date.
<i>nelsona non grata... and non pro</i>