Question about calculating the "Effective Tax Rate"

lanman2000 · Post by **lanman2000** » Thu Mar 07, 2013 12:34 pm

[quote="nelsona"]
US always gets full cut of its own source income, UNLESS it is more than what a Cdn non-US citzoen would pay, trhen there is the re-sourcing mechanism to make sure canada gets everything bove that amount, and US only gets that ammount.[/quote]

I'm even more confused now... I thought the whole point of re-sourcing the income was to re-source all of the bank interest income since Canada doesn't allow a FTC for it. I took the approach of re-sourcing all of it... the US didn't get any taxes from me for this and instead Canada got all of it...

nelsona · Post by **nelsona** » Thu Mar 07, 2013 1:45 pm

That's exactly in line with what I said.

A Cdn non-US citizen living in Canada would not pay any tax on US bank interest, thus a US citizen living in Canada, since they cannot take credit in Canada for any US tax paid on that interst, get to re-source the US interest as foreign, to recoup any US tax that was otherwise calculated on the 1040.

livcyxingfoe · Post by **livcyxingfoe** » Tue Mar 12, 2013 4:13 am

A Cdn non-US citizen living in Canada would not pay any tax on US bank interest, thus a US citizen living in Canada, since they cannot take credit in Canada for any US tax paid on that interst
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