Tax software for doing both Canadian and U.S returns

This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.

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worryfreeinvestor
Posts: 144
Joined: Thu Mar 24, 2005 6:17 pm
Location: Seattle, WA

Now to the US return

Post by worryfreeinvestor »

Pleased to report that thanks to your, (primarily nelsona's) advice, I have successfully used Quicktaxweb to do Canadian taxes, printed it out and mailed it in.

I know that this is NOT a software forum, but nevertheless: I'm using TurboTax for U.S taxes, and planning to file married filing jointly via IRC 6013 (g) or (h) to be treated as U.S. residents for the entire year. (We actually moved on March 29, 2005. No, I do not expect TurboTax to spoon-feed that to me. I plan to write and sign, with my wife, a letter to that effect when I mail the 1040 in.)

I'm not sure how to handle interest and dividend income from Canadian non-registered investments. At the beginning of the TurboTax interview, it asked me if I had foreign investment income, and I typed yes, and specified Canada. Then it never prompted to enter foreign investment income for the whole income section. It didn't pop up again until the end of the tax return, when it took me through Form 1116.

So, is entering the gross interest and dividends at the latter stage (i.e. the 1116) satisfactory or was I supposed to create "fake" 1099-INT and DIV at the beginning of the TurboTax interview?
nelsona
Posts: 16673
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Yes, you need to fake these or simply add them to schedule B manually.

Whatever works to get the paper copy. You won't be able to e-file this year obviously.

as to your letter, you should be sending a form 8833 stipulating that you are using article xxv of the treaty.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D
worryfreeinvestor
Posts: 144
Joined: Thu Mar 24, 2005 6:17 pm
Location: Seattle, WA

Post by worryfreeinvestor »

Thanks again. Plus, as I am electing to file as a resident for all of 2005, and possessed non-registered Canadian a/c's worth more than $10,000 during 2005, I suppose I also have to file Form TD F 90-22.1 by June 30, 2006, right?
worryfreeinvestor
Posts: 144
Joined: Thu Mar 24, 2005 6:17 pm
Location: Seattle, WA

Form 8833

Post by worryfreeinvestor »

Nowhere does it say that Form 8833 is used by married couples in year of move to choose U.S. resident status. Pub 519 US Tax Guide for Aliens page 9 says to submit a "statement". The authority for married couples to choose this, if both become U.S. residents during the year, is IRC 6013(h), NOT the Canada-U.S. tax treaty.

Form 8833 appears irrelevent to this choice. Why would I submit it?
nelsona
Posts: 16673
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

The 8833 would override any requirement for a letter, as 2 US citizens don't need to make any choice, and would alsoi serve to indicate that your are resident even if you do not meet SPT (I have no idea whether you met SPT or not -- which is a criteria for making this choice in the first place.) It would also establish your right to use 2555, which is not part of this election.

Also, making the formal election to be treated as a resident may result in you losing some treaty benefits that you may be entitled to.

invoking the treaty is simply 'simpler'. if you need to invoke XXV for one reason, you might as well simply invoke it globally. Rememebr it is a non-discrimination clause, which allows you somewhat to pick and choose. The choice does not.


As you may be aware, the criteria which make it absolutely necessary to file an 8833 are so stringent that almost no individual 'has to' file an 8833. 8833 in most cases serves as guidance for IRS to remove any doubt as to what you are doing.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D
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