US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

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StormyExpat
Posts: 1
Joined: Sat Jun 29, 2019 10:14 pm

US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

Post by StormyExpat »

Hi All,

I'm trying to understand if the Canada departure tax affects me in the current situation:

Citizenship: US
Residency: Canada
Timeline: Departing Canada in the next 1-2 years back to the US.
Brokerage: US Only, no Canadian Brokerage.

Do I need to sell my US stocks in a US brokerage account to satisfy the requirements of the Canada Departure Tax, as dispositioned property?

Thanks.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

Post by nelsona »

Departure tax arises whether you sell or not, and you can use the unsold stock as security against the tax.

Btw, you do know that a a US brokerage is not allowed to have account for a CDn resident?
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
CRAIRS
Posts: 5
Joined: Mon Sep 27, 2021 3:37 am

Re: US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

Post by CRAIRS »

[quote=nelsona post_id=526163 time=1627233185 user_id=30]
Btw, you do know that a a US brokerage is not allowed to have account for a CDn resident?
[/quote]

Can you confirm if this true due to a Canadian or US law? A lot of US brokerages will not allow opening accounts with a foreign address, but there are a few like Charles Schwab (https://international.schwab.com/expatriate-essentials) that will allow expats to have US brokerage accounts. How else can a US Citizen Expat maintain an IRA?
CRAIRS
Posts: 5
Joined: Mon Sep 27, 2021 3:37 am

Re: US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

Post by CRAIRS »

[quote=StormyExpat post_id=526150 time=1627158017 user_id=10628]
Citizenship: US
Residency: Canada
Timeline: Departing Canada in the next 1-2 years back to the US.
Brokerage: US Only, no Canadian Brokerage.
[/quote]

if you held the assets before moving to Canada you might want to look into the 60 month/10 year rule for deemed dispositions.

more info here: https://madanca.com/articles/entry/cana ... -tax-rules
and here: https://www.cpacanada.ca/en/news/canada ... arture-tax
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: US Citizen in Canada as a PR - returning to US require selling US Brokerage stocks?

Post by nelsona »

This a Canadian (provincial) regulatory law. Brokers dealing with residents of a province must be licensed by that province.

An exception has been granted for retirement accounts. Then it is up to the individual US firm to decide if they want to bother with IRAs or Roths for CDn residents. Many will not.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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