If I work for a US company under a TN Visa, can the company provide me tax free housing for Visa sponsorship if I also declare non residency in Canada? Or is it only available if I am still a resident of Canada for tax purposes.
TN Visa and housing
Moderator: Mark T Serbinski CA CPA
Well, both Canada and US tax codes provide a tax exemption for clergy housing.
However, my response is almost frivolous, since it is exceedingly unlikely that the poster is a minister of religion. He or she mentions working "for a US <i>company</i> under a <i>TN</i> Visa". A clergy person would be contemplating working for a <i>church</i>, likely on <i>R-1</i> status. Not TN, anyway.
However, my response is almost frivolous, since it is exceedingly unlikely that the poster is a minister of religion. He or she mentions working "for a US <i>company</i> under a <i>TN</i> Visa". A clergy person would be contemplating working for a <i>church</i>, likely on <i>R-1</i> status. Not TN, anyway.
Under the IRS rules of temporary employment with a tax home base an employee can receive tax free housing as a reimbursement for duplicated living expenses as long as the assignment does not last more than 12 months in one area.
In this situation, my guess is that if the worker maintained his tax home in Canada he/she could receive the housing free. But if he/she claims non residency in Canada, does not maintain a tax home in Canada and files as a US resident, I would think that a fixed tax home in the US would be required. Otherwise they would be an itenerant worker.
IF this be the case, my ultimate question would be: If the tax consequnces of maintaing the ties to Canada and receiveing the housing are better than filing as a US resident and paying taxes on the housing, would it (and could you) use the treaty and file as a US non resident (1040NR) and Canadian resident even though you had no income from Canada during a two-three year period you weere working under a TN Visa.
Involved, but this is a great site for this
joseph smith
In this situation, my guess is that if the worker maintained his tax home in Canada he/she could receive the housing free. But if he/she claims non residency in Canada, does not maintain a tax home in Canada and files as a US resident, I would think that a fixed tax home in the US would be required. Otherwise they would be an itenerant worker.
IF this be the case, my ultimate question would be: If the tax consequnces of maintaing the ties to Canada and receiveing the housing are better than filing as a US resident and paying taxes on the housing, would it (and could you) use the treaty and file as a US non resident (1040NR) and Canadian resident even though you had no income from Canada during a two-three year period you weere working under a TN Visa.
Involved, but this is a great site for this
joseph smith
You would need to do the calcs both ways.
The housing allowance would be taxable in Canada, without a doubt.
You could file a 1040NR, as long as you maintained closer connection with Canada (based on treaty article IV). This would mean having home and family in Canada.
Otherwise, there is no way that you could override the SPT, or the 183 day rule, by claiming to be a resident of Canada, without such ties. The earning of money in Canada is not important, the home and family are.
So, if you want the housing allowance, you are going to have to amintain 2 homes, just as the allowance is intending.
I'd also be reading carefully what the limits of this housing allowance are, as you might be in for a surprise.
<i>nelsona non grata... and non pro</i>
The housing allowance would be taxable in Canada, without a doubt.
You could file a 1040NR, as long as you maintained closer connection with Canada (based on treaty article IV). This would mean having home and family in Canada.
Otherwise, there is no way that you could override the SPT, or the 183 day rule, by claiming to be a resident of Canada, without such ties. The earning of money in Canada is not important, the home and family are.
So, if you want the housing allowance, you are going to have to amintain 2 homes, just as the allowance is intending.
I'd also be reading carefully what the limits of this housing allowance are, as you might be in for a surprise.
<i>nelsona non grata... and non pro</i>