Questions on moving back to California from Canada

[albertacali]

Hello Team,

I am definitely not an expert when it comes to US/Canada cross-border taxes, so seeking your advice on a new development.

Background

- I am dual citizen US/CAN, single. Currently living in Alberta. I am single. I live alone in a place I bought for $400K. With the economy these days, it’s probably only worth about $350K now.
- I worked down in California up until January 2013. At that point, I needed to move back to Canada to help out with some family/health issues (I am a big sucker when it comes to family). My company was nice enough to let me work remote from Alberta, under their Canadian payroll. I’ve been a remote worker ever since.
- Recent development. There is a new management structure in place, and I am being “recalled” back to headquarters in California. I have until the start of our new Fiscal Year to make the move back down. In this case, before end of January 2020.

My thoughts

- I am actually ok with the idea of going back. I will start earning USD on their payroll to hopefully offset living costs. And frankly I am growing tired of the alberta winters ☺ They also have me pretty locked in with the golden handcuffs. A considerable amount of my worth is unvested RSUs. That would be very tough to walk away from.
- I understand that since I have been living in Canada for more than 60mos in the past 10 years, that I will be faced with the “departure tax”. I have had massive capital gains on my stock positions since living here. I’d prefer to hang on to the shares, and not need to settle taxes all at once. My plan was actually to start selling portions of the position in the decades ahead to try and be tax smart.
- Ideally, I’d like to keep my condo, so I have a place to crash when I come back to Canada for visits. Would prefer not to rent it out. See next section on questions.

Questions

- Re. departure tax. Does this mean I need to liquidate my portfolio, and settle taxes with the CRA on a subsequent return? What other options to I have? I have read about “posting collateral”, but what does that mean, do I wire CRA a portion of my shares and they hang on to them until I am ready to sell?
- Move date. Am I better off moving this Fall, or should I take advantage of moving in January 2020 for tax purposes? Makes no difference to me. If I do need to sell stock though, it may make sense to sell 50% this year and 50% in January 2020 to spread the bill.
- Condo, do I need to sell this before I move, or is there any angle that would let me hang on to it?
- Is it better off to “exit Canada” or just stay Canadian for tax purposes, while I live down there and earn USD? It certainly would uncomplicate things like the departure tax (would not need to pay), I could keep my condo, etc. Just not sure if I would be protected enough by the tax treaties, or if this opens up other cans of worms.

These are the questions that are top of mind for now. I am sure I am missing some other important pieces here. Thanks for taking the time to read.

James

[nelsona]

You will be on the hook for cap gains taxes whether you sell or not, and you can post security to defer tax until you do sell.
You can keep the condo, it becomes a cottage. It can't be your residence.

Once you move to US, you are no longer Cdn resident, you can't have both, even with the condo. Your life would be in US, and that would make you non-resident of Canada.

[albertacali]

Thank you NelsonA for the quick response. You just answered the two questions I had the most "fear" around. It looks like I should be in good shape, by keeping my condo, and not having to liquidate my stock positions, based on your response.

Question, if you can answer:

What is acceptable as posted security? Is this nothing more than a signed letter or some type of promise to pay X amount of taxes to CRA once I do sell?

Thanks again!
James