Canadian moving to the States but working in Canada

[Anna in Canada]

Hi,
My situation is a little complicated. I am a 40-year-old Canadian married to an American and will move to La Conner, WA, early next year on a CR1 visa. I work as a freelance journalist and editor in Vancouver and intend to keep my Canadian clients. I'm also about to start a small literary agency in Vancouver (but I'll be working from my home office in La Conner). I am also completing my masters degree at UBC so for the next year I will be commuting at least once a week across the border and staying overnight at my sister's in order to attend classes and see clients in Vancouver. Do I file departure tax or do I continue to file Canadian taxes and later, an American tax return once I have American clients? And more importantly, will I be denied American residency status and an immigration visa since I don't intend to severe my work ties to Canada? I need to keep at least one Canadian credit card plus my business account open in Vancouver and I've read that immigrating to the US involves severing all ties in Canada.
I'd appreciate any advice.

[nelsona]

There is absolutely no requirement to sever all Cdn ties, neither to be considered US tax resident, nor to be considered a US permanent resident.

That said, once you enter US on CR-1, and live ther, you have left Canada for tax purposes. You would file a departure return based on that date. You vists to Canada would be just that: visits.

Be sure to notify all Cdn payors that you are US resident from that date.

To ensure that US immigration believes you are US resident, make sure you get WA DL, WA plates, and give up BC medical which you would no longer be entitled to in any event.

You will be requiredto file a US return in the year you get CR-1, as this establishes that you have taken steps toward GC, regardless of where your income comes from.

[Anna in Canada]

Sorry, but just to clarify: would I be filing a US return as an American tax resident/permanent resident and report my Canadian business income as worldwide income? My sole proprietor company is based in Vancouver--most of my income for at least the next few years will come from Canadian clients although I will be doing some contract work for a literary agency in Seattle later next year. I'm confused because an immigration lawyer had told me last year that I would benefit financially if I continue filing Canadian returns as long as I maintained a business in Canada.
I understand about notifying payors, ceasing medical, etc. The only things I want to keep is my business bank account and business Visa card.

[nelsona]

You can have a business in canada. But if you live in US, you report WORLD income there. And if you are not resident in canada, you should not file as such.

Your Cdn business will become one run by a non-resident.

[Anna in Canada]

Thank you very much. This advice has taken a huge weight off my shoulders as I was debating over even starting a literary agency if it meant having to deal with a complicated tax situation. The reality is that I earn a very good income in Canada whereas my career options in the States limited as I work in a niche industry. I've since discovered that this forum is connected to your website so I'm now reading through all of your articles.
Thanks again!