FX Gains/Losses Resulting from Moving to US from Canada

[michaelthef]

Question on reporting of taxes associated with FX trades associated with CAD to USD as part of moving to US.

After moving to the US, I borrowed CAD to buy USD on the Ideal FX platform of Interactive Brokers (IB) to lock in a favorable CAD/USD rate. Upon my return to Canada several months later on a leisure trip, I wired in CAD funds to the broker which then paid off the borrowed CAD and left me with USD, which is what I was trying to achieve. I then subsequently sold off the remaining CAD to buy USD.

Looking at the FX Worksheet provided by IB, it shows some gains/losses associated with the above transactions. However, my understanding is that for tax purposes since I really only converted CAD to USD (with an interim step of borrowing CAD for some of the transactions), that there really isn't a gain or loss here. Am I thinking about this the right way? Or is the right way to think about it that only CAD funds that were deposited into the IB and THEN sold to USD are not going to result in a gain/loss since that's a 1 way trade? Really just trying to figure out if I would need to report the gains/losses showing up on the FX worksheet?

Appreciate any help on this. I would imagine that other Canadians that have moved down have experience with moving currency down. In my case in particular, since I needed to be physically present at a Cdn bank branch to wire the funds, I first had to move down, then open my IB account, and then when back in Canada, wire the funds in. Have a feeling that the interim step of borrowing CAD then covering through the wire has caused a taxable event (which may be OK as this shows up as a loss).

Thank you!

[michaelthef]

Thinking through this more, I understand the doctrine is that if there are two trades then there is a gain/loss. So borrowing CAD and then repaying CAD would qualify as two trades within one leg of the currency pair. So even though economically what I did was one step since I was already naturally long CAD, I think there are two trades for tax purposes.

Looks like my timing on posting was terrible as I just missed nelsona this year. But I think what I just described above should make sense.