Non REsidenStudent Loan Interest Carryforward Allowed

cullen · Post by **cullen** » Mon Mar 10, 2008 4:57 pm

Client returned to Canada after a 3 year absence as a non-resident. Can the student loan interest in the 3 previous years be used as a carry forward?

thanks in advance

nelsona · Post by **nelsona** » Mon Mar 10, 2008 5:11 pm

Do you mean the student loans he was carrying BEFORE he left canada?

Only loans arraged thru the Cdn governmental agencies set up for this purpose qualify.

nelsona · Post by **nelsona** » Mon Mar 10, 2008 5:13 pm

.. so if we are talking loans made after he became non-resident, under some US plan or bank, then no.

cullen · Post by **cullen** » Mon Mar 10, 2008 6:31 pm

Loans made before departure through the CDN gov. He never informed me of their existence the last three years despite my query. Now the he has returned, I can either amend the US return or use them as carryforwards in Canada (if possible). I would prefer to do the later based on %tax savings.

nelsona · Post by **nelsona** » Mon Mar 10, 2008 10:06 pm

Whether or not he uses them on his US return, he can still use them on his Cdn return.

Why would you think this was an 'either or' situation.

cullen · Post by **cullen** » Tue Mar 11, 2008 6:01 am

I intend to do both but I needed to clarify the possibility of a carryforward even though the interest was paid during non-residency. I could not find anything that addressed that scenario.
Thanks

nelsona · Post by **nelsona** » Tue Mar 11, 2008 7:01 am

You said: "I can either amend the US return or use them as carryforwards in Canada (if possible). I would prefer to do the later based on %tax savings".

You then said: "I intend to do both".

Doesn't quite jive. Or are you using the Cintonesque definition of the word 'or'.

At any rate, the CRA wording is pretty clear: "...the interest you, or a person related to you, paid on that loan in 2007 and/or the preceding five years. ...
You can claim an amount only for interest you have not previously claimed."

Since it is not a use it or lose it deduction, nor is there a yearly form to fill out to track this interest, simply having the receipts for the past 3 years (CRA will know if any was claimed) will do the trick.

cullen · Post by **cullen** » Tue Mar 11, 2008 8:02 am

Thanks

Clinton struggled with the word "is" - they still do. Obama is not a VP candidate like they say he "is".

Dont care for either of them. Thats beyond this board though

nelsona · Post by **nelsona** » Tue Mar 11, 2008 8:04 am

.. nor do they seem to know the definition of 2nd ... or last.