Canadian travel Nurse, meets Substantial Presence but no perm address in the US

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Travel-ER-NURSE
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Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by Travel-ER-NURSE »

Hi,
So I'm a Canadian travel nurse and only work in the USA for the last 3 years. Over 300 days per year hence meeting Substantial Presence Test but ALL my ties are in Canada ie. Drivers License, mortgage on house paying utilities, car insurance/plates. I have no permanent address in the US as I move to a different city/state every 13 weeks.

I can't stablish residency in any state in the US despite my overwhelming presence here and therefore as resident of Canada I receive weekly tax free stipend. I noticed my accountant filed me as nonresident stating I only spent 14 days in the US. Am I a resident or nonresident? Would the Closer Connection exception apply to me with 300 days in the US? In every one of those 300 days I have the intent to go back to Canada as this job is temporary and my home is in Canada.

I also file married separately but would it be financially better to be a resident alien filing married for tax benefits? Thank you in advance for your help :)
nelsona
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Re: Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by nelsona »

Closer connection only works when you meet the Sustantail presence test (which a cumulative 3-year long test) but doe NOT spend 183 days in US in any one calendar year. Since that doesn;t apply to you, you then need to rely on the treaty, which allows one to determine that, although they surpass the critirea for residency of two countries, their clear place of residence is in one or the other.

In your case, the "permanent abode" clause would make you resident (still) in canada, but only if you maintain a permanent place to live in Canada (your post does not make that clear). Having a mortgage on a place you own but rent out in NOT a permanent abode.

If you have no abode in either country, then other secondary ties become the deciding factor, including in which country you work, where your mate resides, and some of the other things you mentioned, etc. These could very well make you (still) a Cdn resident; seems to me you would have ben looking into this in the past 2-3 years, no?

If you are indeed (still) a CDn resident, then yes you can file a 1040NR in US and a regular full income tax return in Canada. The 1040NR has questions which can be answered to indicate whey you are non-resident, and you simply go on. However, there is no way that your accountant should be falsely indicating that you spent two weeks in US when you are spending more than 10 months.

Anyone can choose to file a full-year married resident, as long as they then meet all the other requirements, which would no doubt include reporting this stipend.
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nelsona
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Re: Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by nelsona »

If you file in Canada, your stipend is probably taxable in canada.
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nelsona
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Re: Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by nelsona »

btw, the reason I indicated "(still) resident" in Canada is because the criteria for breaking Cdn residency are a little more stringent than making Cdn residency.

If you had been living in the US and lived like you are now, there is no doubt you would be a US resident and CDn non-resident, However becuase you DID live in Canada, the question becomes have you done "enough" to break CDn residency. From what you describe, especially if you do have a place to live in Canada, I would say that youa re still a Cdn resident.
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Travel-ER-NURSE
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Re: Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by Travel-ER-NURSE »

Thank you so much for your reply. It does clarify a lot. I do maintain a full home in Canada with all my personal belongings and not rented as my son still occupies his room while going to school. I would never dispute Canadian residency and am happy to pay taxes there. It was the amount of days living full time in the USA and seeing my accountant stating it was only 14 that really confused and worried me.
If you'd allow me one more question.... it seems like a married couple pays significant less taxes in the US so, wouldn't it be more advantageous for me to file as a married resident filing jointly (I could be a resident of both countries correct?) than nonresident which only gives the option of filing married-separately? My husband earns no income. Or doesn't it make any difference as all taxes paid in the US only counts as a tax deduction in Canada and the less I pay in the US the more I pay in Canada?
nelsona
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Re: Canadian travel Nurse, meets Substantial Presence but no perm address in the US

Post by nelsona »

You could CHOOSE to file as a resident, but this would be a more complicated return, and would include spouse. Since you say you end up using all the tax you pay to US as a credit on your CDn return, it is not worth the bother. Continue filing a 1040NR, expalining why you are non-residnt (not be underreporting your days in US), and you will be fine.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D
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