Short-term work transfer to US from Canada

[TopTax2013]

I work for a subsidiary of a US firm in Canada. I will be transferred to the US office for 4.5 months this summer with my family and then return to permanent employ from the current Canadian branch office. I will sever no ties/residency etc. I can either go down on an L1 or a TN without any difficulty. During this temporary period, accommodation will paid for by my employer since this short-term US placement is mandatory for me. I have several questions about the tax implications of this move.

1) Is there any necessary tax withholding from the US-side, if I continue to be paid from the Canadian company while in the US? Won't I end up filing only a Canadian tax return in any case due to the short term of the transfer?
2) Company has suggested transitioning both my benefits and "where I'm paid" to come out of the US office for this 4.5 month period. This seems like a mess -- and unnecessary (???). Seems this would automatically trigger US income taxation (I would guess) as well as suspend by current RRSP plan, etc. Is this approach either necessary or recommended for some reason?
2a) Also, I'm concerned about having to re-apply/re-start my benefit and health plan in Canada afterwards, etc...
2b) Simply planning to US coverage extended on my existing health plan prior to departure...
3) My understanding is that the housing expense that is paid for me while in the US (because it is temporary and not 'transitional') is not a taxable benefit under US tax law. However, a) I plan/want to be taxed as a Canadian only, and b) have no idea if Canada tax law also exempts this housing payment from taxation as a 'benefit'.

Any help is very welcome. Thanks!

Topper

[nelsona]

1) This depends on what other cdn employees they have or will send down in the next while. If you are part of an ongoing project, and your firm is deriving much of its reenue from this project, it could be a permanent establishment, making your wages taxable in US, even though you are there less than 6 months (more than six months would make you definitely taxable).


2). subject to what I said above, I agrre with you, not for taxation, but for uselss benefits

3a typically expenses paid while traelling on business are not taxable in Canada.

[TopTax2013]

Turns out making over $10K in 4.5 months triggers a US tax filing, and cannot be avoided.

Housing should be excluded as taxable, as long as my employer does not inadvertently withhold tax out of a "best intention" to be compliant; as this will complicate and possibly defeat proper filing of this expense.

[nelsona]

The 10K does NOT apply to Cdns working in US for Cdn employers. the 10K applied to Cdn residnts working in US for US employers.

If you continue to be paid by Cdn employer, the 6 months is what counts, and 10K means nothing.

Tirns out whomever is talking to you is wrong.