State Return?

peon · Post by **peon** » Wed Apr 26, 2006 5:45 pm

If a U.S. citizen moves to Canada as a landed immigrant due to marriage, but keeps all the investments like bank accts, stocks, IRA behind thinking to move back in the future, will the U.S. citizen require to file tax returns for the state and IRS? For IRS level, I'd think the answer is, but for stae, it's a little bit confusing. The U.S. citizen has no employment income from either USA or Canada.

nelsona · Post by **nelsona** » Wed Apr 26, 2006 6:00 pm

I don't know of any state that taxes non-residents on any income other than real estate and wages coming from that state. Sometime a state pension *might* have some tax tied to that state, but this is rare.

A bank account or investment account held in a particular state does not make that state the 'source' of the income.

peon · Post by **peon** » Wed Apr 26, 2006 6:57 pm

The state makes use of Federal Adjusted gross income (which makes up of wages, taxable interests, dividends etc.), that's why it makes me believe interests is taxable at the state level. I guess it's for residents only?

Is there any form to file to declare non-resident in the State in this case or simply file a non-resident state tax return?

Will interests and dividents in the State need to be claimed in Canada as income in this case or not?

Thanks so much for your help, Nelson.

nelsona · Post by **nelsona** » Thu Apr 27, 2006 2:40 am

In the year that you leave a state you typically file a prt-year return, since you do owe tax for all income that you earned while still living there. After that, that's it for you and your former state.

Once you move to Canada, you must report ALL world income from every source on your Cdn tax return, as well as on your IRS federal return.