Hello. I am a Canadian citizen who will be graduating from medical school in 1 month. I went to med school in the USA and now will be doing a residency in Oregon for 3 years. I currently have an F-1 student visa and have applied for the OPT for 12 months afterwhich I will apply for an H1B. I am also married and have children. My wife will not be working.
There are 2 other Canadians in the residency program that I will be attending. One has kept their Canadian residency and pays taxes in Canada, the other claimed non-resident status in Canada and pays US taxes.
I have student loans in Canada through the government and a bank. My tuition from my US school was around $120k for the 4 years.
What are the pros and cons to filing in Canada vs the USA? Also, I would like to be able to claim my tuition as a deduction, can I do that in the USA? Which option gives me more net income per month? Also, do I need to hire an accountant for any of this?
Thanks a ton!
Filing taxes in US with OPT
Moderator: Mark T Serbinski CA CPA
Technically, those on F1 cannot file as US residents, and therefore cannot break Cdn tax residency. F1 status requires mainatining a physical residence in Canada as well. OPT is considered F1.
So there really isn't a choice. Perhaps the one who broke residency had another US status previously, has a spouse who has another US status, or has spent sufficient time in US to have his F1 time count towards US tax residency.
Obviously, if you have little or net income, it doesn't really matter, you aren't going to pay much tax anyways. I suppose keeping Cdn residncy allows one to build up a bigger reserve of tuition credits, if one is planning to go back to work in Canada. Tuition expenses are deductible in US as well.
Regardless of ones Cdn tax residency status, all Cdns can file a 1040 rather than a 1040NR, if that benefits them. This would be most beneficial for married individuals, like your self. This has no impact on Cdn/US tax residency.
The one who declared CDn non-residency had better be filing a 1040 and not a 1040NR and reporting any Cdn-source income.
So there really isn't a choice. Perhaps the one who broke residency had another US status previously, has a spouse who has another US status, or has spent sufficient time in US to have his F1 time count towards US tax residency.
Obviously, if you have little or net income, it doesn't really matter, you aren't going to pay much tax anyways. I suppose keeping Cdn residncy allows one to build up a bigger reserve of tuition credits, if one is planning to go back to work in Canada. Tuition expenses are deductible in US as well.
Regardless of ones Cdn tax residency status, all Cdns can file a 1040 rather than a 1040NR, if that benefits them. This would be most beneficial for married individuals, like your self. This has no impact on Cdn/US tax residency.
The one who declared CDn non-residency had better be filing a 1040 and not a 1040NR and reporting any Cdn-source income.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
Once you are H1, you can (and should) declare Cdn non-residency, by filing a departure return from canada, just like your colleague presumably did.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best