Living in Canada and working in US - Returns for 2007

wimzieguy · Post by **wimzieguy** » Fri Mar 14, 2008 2:52 pm

Hi,

I am a married Canadian citizen with 2 kids living in Windsor and commuting daily to work in US. Which tax form should I use?
Based on the information available on this forum, it appears that I can file using either 1040A or 1040NR but when I browse IRA website, it appears that I have to use 1040NR only?

Can any one please confirm whether it will be legal for me to use 1040A?

Thanks.

Ak

wimzieguy · Post by **wimzieguy** » Tue Mar 18, 2008 12:07 pm

Still waiting for some expert advice...

nelsona · Post by **nelsona** » Tue Mar 18, 2008 2:01 pm

First off never use 1040A, use either 1040 or 1040NR.

You can do either , but if you use 1040, you must report ALL income, and must also report your RRSPs on form 8891. And, unlsee you file jointly with spuse ALSO reporting world income, the tax will be much higher (married filing separatly).

This will not lower your tax any, since you are taxbale in canada in the end.

The absolute best way to file is a non-discrimination XXV 1040NR calculating the taxrate on your wages 'as if' you were filing a 1040 joint.

I ahve explained this elsewhere.

wimzieguy · Post by **wimzieguy** » Tue Mar 25, 2008 2:08 pm

How do I calculate the joint 1040 tax rate?

nelsona · Post by **nelsona** » Tue Mar 25, 2008 2:20 pm

By preparing a 1040 joint return with your spouse, reporting all world income, and using all deductions available to you, as if the income had all arisen in US.

You then take the gross income and the final US tax andf this is your taxrat.

You then fill in a 1040NR, calculating the tax that it yeilds. If the income reported on your 1040NR times the taxrate determined on your 1040 is less than the 1040NR tax, you use this value.

wimzieguy · Post by **wimzieguy** » Wed Mar 26, 2008 9:58 am

fantastic..... thanks.

one last question... I need ITN #'s for my dependents.

Can I send the W-7 forms with my tax returns (indicating that ITN# has been applied for) directly to ITN office in Austin, TX?

nelsona · Post by **nelsona** » Wed Mar 26, 2008 11:08 am

The W-7's MUST be sent with the returns. You MUST send the entire package to Austin, and not to any local/regional office.

nelsona · Post by **nelsona** » Wed Mar 26, 2008 11:10 am

You could also walk (not mail or drop) the return to a local office where they would verify your supporting documents (passport, birth cert, etc) required for ITIN