I need help with this special case:
I left Canada in May 2003 to work in the US without completing the required NR73, so I ended up paying taxes in the US & Canada for 2003 and for 2004.
In May, 2005, I sold an investment property in Canada, and because I am a resident of Canada, I did not pay 25% up front in Capital gain tax.
Now my principal home in Canada is for rent, my kids are independents and my wife resigned from her job in Jan 2005 to join me in the US.
Should I complete NR73 in June 2005 to avoid paying 2005 Canadian tax? If so, then would I have to pay back the 25% Capital Gain Tax realized in May 2005 right away or I can offset it next year with the capital loss I had accumulated in previous year?
should I complete NR73 next year, pay 2005 income tax in Canada, and in the US, and then rent my principal home to an unrelated party? If I rent my home for 3 to 4 months a year, do I claim expenses and report rental income in the US only? If I have positive cash flow, do I have the right to depreciate this property, and reduce my US income? If so, how much I can depreciate it by?
Many thanks in advance for your help.
MCH
Leaving Canada
Moderator: Mark T Serbinski CA CPA
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica" id="quote">quote:<hr height="1" noshade id="quote">I left Canada in May 2003 to work in the US without completing the required NR73<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
NR73 was never required. However, even if you had filed you would not have been non-resident, since your family was still in Canada.
From what you say, you became non-resident in Jan 2005, so you will still be filing a Cdn return for 2005, so you can report the sale of your investment corectly next spring. You have no need to file NR73.
You do have to begin remiting tax on your rental income. This is clearly explained in the Emigrants and Non-residnts guides from CRA.
The rules for rental propert ya reclearly define in both counties. You will ahve to learn them yourself.
<i>nelsona non grata... and non pro</i>
NR73 was never required. However, even if you had filed you would not have been non-resident, since your family was still in Canada.
From what you say, you became non-resident in Jan 2005, so you will still be filing a Cdn return for 2005, so you can report the sale of your investment corectly next spring. You have no need to file NR73.
You do have to begin remiting tax on your rental income. This is clearly explained in the Emigrants and Non-residnts guides from CRA.
The rules for rental propert ya reclearly define in both counties. You will ahve to learn them yourself.
<i>nelsona non grata... and non pro</i>