ACA, USC/Canadian Dual citizen

stewak2 · Post by **stewak2** » Wed Nov 06, 2013 3:03 pm

Dual Citizen Canadian resident commuting to work in US.
Covered by OHIP in Canada.
The ACA (Obamacare ) coverage mandate, are non residents exempted?
Is there a line of the 1040 to reflect this?

nelsona · Post by **nelsona** » Thu Nov 07, 2013 12:06 pm

Are you talking about enrolling in ACA, or are you talking about the additional tax to pay for ACA?

stewak2 · Post by **stewak2** » Wed Nov 13, 2013 3:45 pm

I'm interested in the coverage mandate/tax penalty.
Since I live in Canada and am covered by OHIP, I would like to know if that meets the requirements. I would imagine so or all USC Nonresidents would have this issue, but...I have been wrong before

nelsona · Post by **nelsona** » Wed Nov 13, 2013 4:02 pm

Non-residents are exempt from ACA. They will however be subject to the high income unearned income tax that is part of the funding. This is not the penalty for non-compliance.

https://www.healthcare.gov/exemptions/

nelsona · Post by **nelsona** » Wed Nov 13, 2013 4:05 pm

https://www.healthcare.gov/am-i-eligibl ... rketplace/

stewak2 · Post by **stewak2** » Wed Nov 13, 2013 5:20 pm

Thanks.
I have been filing MFS since my wife is Canadian (only ).
The exemption level for the additional Medicare Tax is 250K for MFJ but only 125K for MFS ( 200K single ).
My wife owns RESP for kid, has TFSAs, etc guess that means problems for her if I file MFJ? Understandably she wants nothing to do with the IRS.
I should divorce her and file single ( 200k ). That;s a pretty big marriage penalty since an unmarried couple would have exemption of 400K total vs 250K for married.

stewak2 · Post by **stewak2** » Wed Nov 13, 2013 5:22 pm

OTOH, I suppose since this is part of Medicare/FICA I can claim Foreign Tax credit on it?
Would probably work out in end as I end owning CCRA most years.

nelsona · Post by **nelsona** » Thu Nov 14, 2013 9:50 am

Right now, since you have no US income, you can't claim any US tax as a credit on your Cdn return, and the extra tax is NOT relieved by 1116 on your US return, so you will have to pay the tax. Price of being an american.

stewak2 · Post by **stewak2** » Wed Nov 20, 2013 8:58 pm

I commute to work in US so all my income is US.
So I should be able to claim a foreign tax credit for it on CCRA return, just as I do with all my other US taxes paid. Correct?

nelsona · Post by **nelsona** » Thu Nov 21, 2013 5:50 am

Correct.
Just a note on the Fee portion if you are a commuter. The criteria being talked about for exemption from the fee are the one's used for 2555. Since you don't use 2555, this could get tricky. You may have to file 2555 to attest to eligibility (you would use the bona fide tax home) but no foreign income.