Canada & U.S. self-employment income reporting & tax

[Cangrad]

I have a few questions regarding self-employment income reporting & taxation and would appreciate help.

I am a U.S. citizen, studying for my PhD in Canada for the past 3 yrs., and I file a Canadian “residentâ€￾ tax return. In addition to my non-taxable Canadian fellowship income for 2013, I have taxable income from part-time work as a Teaching Assistant and ~ $2000 net income from a brief stint of Canadian self-employment as a sole proprietor earlier in 2013. For my 2013 Canadian tax reporting, I plan to file form T2125 along with my regular return and pay whatever Canadian self-employment tax is required.

For U.S. tax purposes, I qualify as a bona fide resident of Canada and am able to use the Foreign Earned Income Exclusion. I have never been “self-employedâ€￾ in the U.S. and did not receive any income in the U.S. in 2013. For my 2013 U.S. taxes, do I really have to file a Schedule C or can I just lump my small amount of net self-employment income in with my world wages, etc. income on Line 7 of my 1040?

Also, is it correct that even if I must file Schedule C, I should not have to pay U.S. self-employment tax because I will be paying into the Canadian Social Security system? If so, must I obtain a “certificate of coverageâ€￾ from the CRA to prove to the U.S. that my small amount of Canadian self-employment earnings should be exempted from the U.S. self-employment tax?

Thank you very much for your help!

[nelsona]

you do need to file sched c. should be too hard since you are reporting the same info in canada.

You shouldn't need the compliance cert since you aren't self-employed in US, unless IRS would ask for one, which would really only be in your tax residency was in question. Yours is not in question.

[rlb]

Although your fellowship may be non-taxable in Canada, it may well be all or partially taxable in the US. Any part which is used to pay for certain expenses such as tuition is non-taxable in the US, but any part of the stipend which is for living expenses is taxable and not excludable as part of the foreign earned income exclusion (as it is not earned). However, of course income earned as a teaching assistant can indeed be excluded. Look up scholarships and fellowships in the US tax guides.

[Cangrad]

I thank you both for your responses. I had a feeling that I would need to file Schedule C to account for the small amount of self-employment income. On further investigation of the matter yesterday, I found that in cases such as these, the IRS does seem to also require that a "certificate of coverage" from Canada be provided. Oh well.

As for my foreign fellowship which is entirely tax-free in Canada, I am aware that certain parts of the income are indeed taxable in the U.S. Interestingly, I was informed recently by several different IRS agents who deal with international returns, that any such income appearing on Line 7 of the 1040 is considered earned income and is therefore eligible for the Foreign Earned Income Exclusion. I guess I'll have to look into this further.

Thanks again for your help.

[nelsona]

As I said, only if you are in US are you required to get a cert of coverage. They can of course aksyou to get one, but since you are using 2555 I would doubt that.

Simple to get though, so why not just do it.

[puzoguza]

If you have posted anything wrong against the policies this is the reason you are blocked. You are required to contact to Administration department on https://www.bestdissertations.com/thesis.php you can get the details of the latest version of the posts that should be more than this because of some policies.