US/Canadian tax returns

macwhorter · Post by **macwhorter** » Tue Feb 06, 2007 12:55 pm

hello-

(1) I am a US citizen and a new permanent resident of Canada (as of October 1, 2006). It is my understanding that I need to be resident for at least 183 days in order to have to file a Canadian tax return. So, no Canadian return is required for 2006? Is that correct?

(2) I am on disability and have disability income for 2006 from my former employer in the US, which I know I must claim as income on my US return. Will future disability income be taxable as Canadian income in futire years (2007 and beyond)?

(3) Finally, My spouse and I own a home here in Canada, which is our primary residence. Am I able to deduct the Canadian mortgage interest on my US return?

Any help is most appreciated.
thank so much in advance!

nelsona · Post by **nelsona** » Tue Feb 06, 2007 1:54 pm

1). No. you are a resident since october and have to report all world income after that date. Please read the "Newcomers" guide on the CRA website. The 183 day rule applies to someone who does NOT live in canada.

2. Yes. Even the portion received after October 2006 is reportable. You will be able to claim the US tax you paid on it as a credit.

3. Yes. And the real estate taxes, too.

macwhorter · Post by **macwhorter** » Tue Feb 06, 2007 2:10 pm

thank you so much that is very helpful!

macwhorter · Post by **macwhorter** » Tue Feb 06, 2007 9:38 pm

oh, one other question. how do I account for the fact that my Canadian mortgage interest and real estate taxes are in CANADIAN dollars? Does IRS do a conversion?

thanks again.

telly1 · Post by **telly1** » Tue Feb 06, 2007 9:50 pm

nelsona can confirm but I believe you use the Bank of Canada exchange rate. For 2006 it was 1.1341.