This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.
A relative of mine is a US resident who is going to receive C$10mm in Canadian stock on selling his business. His cost basis in the shares is C$1mm. The shares are now worth C$10 mm. The shares are in his name. He would like to open a joint account with his (US citizen/US resident) wife and move the shares to the account. What are the tax ramifications involved both to him and her? Thanks.
Thank you. One more question. If the stock pays dividends going forward, who pays the tax? Each joint holder, equally? Can the joint holders choose which one would pay the tax (the wife in the lower bracket, hopefully)?
Although my relative is a US citizen/tax resident, he does have a Canadian address (cottage) as well. He is currently holding the shares at a Canadian brokerage firm, using this Canadian address (the firm is not licensed to do business with US residents). His understanding is that when the company starts paying dividends (in short order), there will be no witholding tax on the dividends, if held at the Canadian brokerage firm. On the other hand, if he moves the shares to a US broker, there will be a witholding tax. Will he be violating any tax laws, in either country, if he chooses not to move the shares to a US broker?