A question about emigrant.

samuel7 · Post by **samuel7** » Sun Mar 25, 2012 5:06 pm

Great forum, a lot of informations.

I am a Canadian citizen, and I started a job in USA since November 2011.
My wife and 2 kids are still in Canada and they will join me later this year.

On the CRA website it mentions
"Generally, you are an emigrant of Canada for income tax purposes if you leave Canada to settle in another country and you sever your residential ties with Canada."

According to this, I am NOT an emigrant until my wife comes. But if that is the case, which date should I put in the "departure date" box in the next year's tax return, January 1 or the day my wife joins me?

Thanks in advance for your help.

JGCA · Post by **JGCA** » Sun Mar 25, 2012 6:35 pm

January 1st has no relevance here as all, if it wasn't the time you left in Nov 11 because you still had strong residential ties in Canada then it will most likely be the day your family leaves to join you. However this is not written in stone, if you came in Nov 11 and your house was sold and your family was on their way over then this too could be a valid departure date.

When was the home sold to me would be an important factor since that is the time your family was intending to leave and your residential ties would be severed.

More interesting is how are you going to file in the US, and if you are still resident of Canada this income in 2011 will be showing on your CND return also.

samuel7 · Post by **samuel7** » Mon Mar 26, 2012 10:15 pm

Thanks for your prompt reply.
This is more complicated than I thought. My house in Canada is not sold yet. So I still have two significant ties in Canada. I think I'd better contact the CRA and see what they say.

As far as the tax return, I think am going to file the 1040nr in the US, just report the US income. For the CANADA side, I will convert my US income into Can$ and report that. I will also claim the Foreign tax Credit. Am I on the right track?

nelsona · Post by **nelsona** » Tue Mar 27, 2012 9:41 am

The treaty would make you non-resident, follow the treaty. CRA will not advise you correctly on using the treaty.

samuel7 · Post by **samuel7** » Wed Mar 28, 2012 12:19 am

Contacted CRA, the person told me that the day my wife/kids join me would also be my departure date. This year I will still file the CND return as a resident, and report the US income.

[quote="nelsona"]The treaty would make you non-resident, follow the treaty. CRA will not advise you correctly on using the treaty.[/quote]
Hey Nelson,
Which part of the treaty will make me a non-resident to Canada, is it the XXV?

My understanding is that I can file 1040 instead, with the forms 1116 and 2555 as mentioned in other topics. Is that correct?
Any advantage if I file this way instead of the 1040NR in my case?

Thanks.

nelsona · Post by **nelsona** » Wed Mar 28, 2012 9:40 am

Since, you are ignoring what I've already told you, whay would I further waste my time. Call IRS.

JGCA · Post by **JGCA** » Wed Mar 28, 2012 9:55 am

Nelsona is right, the Treaty overrides the ITA file as non resident

samuel7 · Post by **samuel7** » Thu Mar 29, 2012 8:49 pm

Nelsona and JG, thanks a lot for your suggestions.

Nelsona, I am not ignoring you. I called CRA before I saw your post. I thought I just post it out to let others know. CRA's suggestion is not always best.

Questions I hope you can further explain,

1) So if according to treaty, I can file as non-resident of CANADA, does that mean I have to file as a resident (ie 1040) in US side?

2) I haven't close my bank/creidt card accounts in Canada, will that affect my CAN non-resident status? Can you tell me which part of the Treaty I should look at?

If I can file as a non-resident for the last two month, there would be quite some tax savings.

Also another question kind of unrelated,

3) Can we (me and the kids) each claim the full $3700 personal exemption or just 2/12 of this amount, since I just stay here for two months in 2011?

TIA