children born in the us to canadians

Ian · Post by **Ian** » Tue May 22, 2012 6:46 pm

my dauhter was born in the states while i was an educational visa. she was 2 when we left do I need to be concerned about the IRS and her american citizenship?

nelsona · Post by **nelsona** » Tue May 22, 2012 9:44 pm

Eventually, yes. She is a citizen and as such she has (or will have reporting obligations as any child living in US would.

On the bright side, if you file a tax return every year, the IRS wil lsend yoiu $1000 for your trouble, the additional child tax credit.

Filo · Post by **Filo** » Tue May 22, 2012 9:48 pm

Click Search at the top of the page.
For the query: child born in US
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Forum and Category: Canada / United States Tax & Accounting
Click Search

You'll get a large number of relevant posts. Read them. Decide what your most important questions are and start a new thread focusing on those specific questions. Be sure to specify the citizenship and current country of residence of both you and your spouse. (I have no business telling you what to do by the way, but I have noticed that zeroing on one or two points tends to increase the probability of an answer.)

You will see that you could have years of hassles with the complications and obscurity of IRS regulations if your daughter remains a US citizen. If it turns out that you don't want her to be a US citizen, then contact a US consulate now for advice and for instructions on how to renounce her citizenship.

nelsona · Post by **nelsona** » Tue May 22, 2012 10:38 pm

Given the difficulties in immigrating to US, it would be ludicrous to arbitrarily give up her citizenship now.

Let her decide, as an adult, if hse wants the hassle or not.

Filo · Post by **Filo** » Wed May 23, 2012 12:28 am

Well . . ., let her decide as a teenager when she first starts to earn money whether she wants to fill out 1040, 2555, 8938, FBARs and whatever else has been imposed by then. Let her not forget to tell her bank that she's obliged to fill out a W-9. Let her know that it's toxic to make the mistake of opening a TFSA. A few years later, let her know that buying into a mutual fund will bring grief. It would be well if her presumably non-American parents became experts in US tax regulations.

I don't know anything about the situation with an RESP in this case.

No-one could possibly argue about your point that it's exceedingly hard to immigrate to the US. But there's a price to pay to retain that advantage.

nelsona · Post by **nelsona** » Wed May 23, 2012 8:29 am

and millions are willing to pay that price.
How's your renunciation coming, Filo?

nelsona · Post by **nelsona** » Wed May 23, 2012 9:24 am

Besides, there is an obvious way to get around all these reporting requirements: have only an RRSP and stocks in Canada.

If you live in US, you have none of these problems.

UStoCanada · Post by **UStoCanada** » Wed May 23, 2012 3:06 pm

[quote="nelsona"]Besides, there is an obvious way to get around all these reporting requirements: have only an RRSP and stocks in Canada.

If you live in US, you have none of these problems.[/quote]

I guess that's the biggest kicker right there.......if you're a US citizen you better stay in the US or else.

I'll be curious in the next few years if the numbers of people renouncing start to skyrocket as tax complications increase.

eortlund · Post by **eortlund** » Wed May 23, 2012 3:23 pm

What's a W-9?

nelsona · Post by **nelsona** » Wed May 23, 2012 4:02 pm

I guess you could look it up on IRS website.... but W-9 is the method which anyone (but particularly financials) gets prrof that they do not have to withhold taxes on any income they send you.

All Cdn financial institutes require this for their US citizen customers, to avoid liability should they fail to pay US tax on thier income.

If you have not heard of this, methinks it is because you have not been telling your bank/fund/trustees that you are USC.

eortlund · Post by **eortlund** » Wed May 23, 2012 4:11 pm

RBC knows I'm a USC but never mentioned it.

nelsona · Post by **nelsona** » Wed May 23, 2012 4:19 pm

A w-9 would be the only way that they would "know" this officially.

eortlund · Post by **eortlund** » Wed May 23, 2012 4:23 pm

OK, is this necessary for all accounts? I only have checking, savings, and RRSPs. I looked on the IRS website and every article about W-9s refers to a form people use to get ITINs.

eortlund · Post by **eortlund** » Wed May 23, 2012 4:28 pm

I looked more closely at that W-9 and I see more clearly what it is. Do my husband and I just send one each to our 2 banks?

nelsona · Post by **nelsona** » Wed May 23, 2012 4:46 pm

I would. Its not only your bank. Any other financial institution thta can "pay" you (interst, dividends, etc) should have one.