I'm currently H1B and my wife is H4. She would like to convert to an F1 to take get some work experience, but I'd like to avoid becoming a CDN tax resident. Is it possible to have her become an F1 and still maintain tax residency in the US, or would we be hooped?
Thanks.
(Also, does anyone know if it's possible to get an F1 without having mass quantites of cash in the bank? I would be supporting her through my work in the US on H1B, plus we qualify for highly reduced tuition (virtually free) since I work at a higher-ed institute).
Avoiding CDN Tax Residency on F1
Moderator: Mark T Serbinski CA CPA
The fact that she has already ceased to be a Cdn tax resident (I'm assuming) makes this more possible than if you had moved here of H1 and F1.
This is because her time in H4 has allowed her to meet SPT, and thus she does meet the IRS standard of tax residency.
So going forward of course, she would not, but this is not easily determined by CRA at this point as they have let go of her and thus she needs to actaully re-establish a REAL residential tie to Canada to be re-considered a Cdn tax resident.
The way to be above board on this would be for YOU to always elect to file jointly with her, and not availing yourself of any tax exemptions that foreign students may have. By the sound of it it doesn't look like she would be getting Cdn grant money, so this shouldn't be a problem. You would not want her to file as a non resident in US, ebven though, by 2006, she probably could.
There usually isn't any tax advantage for a married couple to file one resident one non-resident, especially if the non-resident has US-sourced income.
The address you give for foreign residency can be a relative.
<i>nelsona non grata... and non pro</i>
This is because her time in H4 has allowed her to meet SPT, and thus she does meet the IRS standard of tax residency.
So going forward of course, she would not, but this is not easily determined by CRA at this point as they have let go of her and thus she needs to actaully re-establish a REAL residential tie to Canada to be re-considered a Cdn tax resident.
The way to be above board on this would be for YOU to always elect to file jointly with her, and not availing yourself of any tax exemptions that foreign students may have. By the sound of it it doesn't look like she would be getting Cdn grant money, so this shouldn't be a problem. You would not want her to file as a non resident in US, ebven though, by 2006, she probably could.
There usually isn't any tax advantage for a married couple to file one resident one non-resident, especially if the non-resident has US-sourced income.
The address you give for foreign residency can be a relative.
<i>nelsona non grata... and non pro</i>