TN visa holder filing US income tax return

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smalhot05
Posts: 10
Joined: Wed Mar 14, 2018 1:08 am

TN visa holder filing US income tax return

Post by smalhot05 »

Hi there,

(1) I moved from Canada to US for job and when I filed my NR73 for residency status determination, I was termed as deemed non-resident of Canada even though I have a house, TFSA, RRSP, debit and credit cards, and driver's license in Canada. Do you agree with the assessment or should I write back to CRA?

(2) While filing my US income tax return, for the TFSA accounts (in there the money is in savings account and non-reedemable GICs), do I have to file form 8983 even though assets are < 50K. If not then other than specifying on FBAR, where and how should I inform IRS about my Canadian TFSA account?

Thank you.
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

1. Yes, deemed non-resident is treated just like a non-resident. If you wanted to remain resident, you should not have submitted NR73, as we advise here all the time.

2. That is about it. You do of course owe US tax on any of the internal growth of the TFSA, plus may be subject to PFIC tax on the assets within the TFSA. We advise here to get rid of TFSA when moving to US for those reasons.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
smalhot05
Posts: 10
Joined: Wed Mar 14, 2018 1:08 am

TN visa holder filing US income tax return

Post by smalhot05 »

Thank you for the reponse Nelsona. If I may ask further,
- had I not declared myself as non-resident through NR73, would I have been able to justify not being present in Canada throughout and at the end of calendar year (hence not being a resident), still received rental income + lived and earned in US as a non-resident then? Because if you are saying that I should not have submitted NR73, then I may have committed a grave mistake and I ruin the fact that I didn't find out amazing website and forum at that time.
- Is there a way to undo that by writing to CRA?
- Kindly advise which form I should submit to declare/submit PFIC tax. If I would have got rid of TFSA (which is pretty much my 7 yrs of saving in Canada), I would not have been able to pay property tax (that I pay every year) or have had money for any eventualities. Like my property was destroyed by previous tenant and I had to re-build it, which I could only do by taking money out of TFSA savings.

I have till yet filed 2016 return and before I file 2017 return, through your guidance, I would really like to rectify any mistakes that I may have committed inadvertently.

Thank you very much.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Well, you ARE a demmed non-residet, as I said I agreed with their conclusion.

As for any other questions, you have come here a little too late (18 months too late) for me to help you at this time. See my signature

Browse for answers, as they are all here already many times.

And don't hijack threads.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
smalhot05
Posts: 10
Joined: Wed Mar 14, 2018 1:08 am

TN visa holder filing US income tax return

Post by smalhot05 »

Thanks Nelsona for your help.
simkessy
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Joined: Thu May 03, 2018 12:58 pm

Post by simkessy »

[quote] You do of course owe US tax on any of the internal growth of the TFSA, plus may be subject to PFIC tax on the assets within the TFSA. [/quote]

Does internal growth here include "Non-realized capital gains"
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

No. but if your TFSA has Cdn mutual funds or ETFs, the PFIC rules will likely make them taxable year-over-year on the non-realized growth, by the mark-to-market regime.

There are other threads on PFIC. Consult those.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

I guess it is more correct to state that you will be liable for US tax on the internal INCOME of your TFSA.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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