Canadian on TN Visa with freelance work from Canada tax

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doadoa
Posts: 3
Joined: Wed Jul 27, 2022 6:53 pm

Canadian on TN Visa with freelance work from Canada tax

Post by doadoa »

Hello,

I am Canadian Citizen on TN Visa residing in Washington State.
I have been US resident for tax purposes for more than 2 years now under TN.

In the attempt of getting a new TN due to change of job, application has been denied and previous issued TN was revoked and was forced to go back to Canada.
While in Canada, I worked for the new company as a freelancer for a month while TN issue was being sorted out.

Luckily I was able to get back to US with TN Status and now working as their employee.

In this situation, how will the tax will be treated?
Can the amount that I earned in Canada be filed as non-resident income to Canada and pay the difference to US?

Does it matter which account that I receive the money in for the freelancer amount?
Money will be paid in USD. Not too sure if I should open Canadian based USD account or US Checking account to receive the fund.

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

Re: Canadian on TN Visa with freelance work from Canada tax

Post by nelsona »

As long as you did not establish a residence in Canada, the income is reported solely in the US, no need fpr a Cdn tax return.
The freelance income will be treated as self-employment income on your US return.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
doadoa
Posts: 3
Joined: Wed Jul 27, 2022 6:53 pm

Re: Canadian on TN Visa with freelance work from Canada tax

Post by doadoa »

Thanks for the reply nelsona
Yea, I didn't establish the residence in Canada, so that would make things a lot simpler.

However, if this gets considered as self employment income to US, wouldn't that get me into trouble with TN Status?
I thought you were not allowed to have self employment income while on TN.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Canadian on TN Visa with freelance work from Canada tax

Post by nelsona »

Many TNs are self-employed. It is self-sponsorship that is not allowed.
Besides, you were not in US, and were not in any status when you were working in Canada.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
doadoa
Posts: 3
Joined: Wed Jul 27, 2022 6:53 pm

Re: Canadian on TN Visa with freelance work from Canada tax

Post by doadoa »

Nice! that's good to know
It's a lot simpler than I thought it would be.

Thanks nelsona!
Brahams
Posts: 1
Joined: Wed Jul 12, 2023 4:16 am

Re: Canadian on TN Visa with freelance work from Canada tax

Post by Brahams »

Typically, income earned in Canada is subject to Canadian taxation, even if you're a non-resident. However, since you were residing in the US for tax purposes and working under TN, it's worth exploring whether you can file that income as non-resident income in Canada and pay the difference to the US.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Canadian on TN Visa with freelance work from Canada tax

Post by nelsona »

Not the correct answer.

As I said earlier, self-employment income eatrned by US residents, even earned in Canada, is not taxable in Canada unless one establishes a base there, which is not the case here.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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