My husband and me are filing our first year tax return in US. I was wondering if somebody could help us out with some questions we have.
My husband is German citizen who worked in Switzerland for 5 years before coming to Canada in Jun 2010 for a university post doc position. He finished his postdoc in Canada at end of May 2012 but stayed in Canada till Mid Jul as a tourist before heading back to Germany to get his H1B visa. He started his job in Mid Aug 2012. I joined him in US in Sept 2012 as a visitor and we got married in Feb this year and I changed my status to H4.
I did some research here and know that we might have 3 options to file his 2012 US return: because he doesn't meet the 183 days rule he can file NR alien, dual status through first choice, or resident alien using 2555/1116.
US return:
1. Does US Canada tax treaty (especially form 2555/1116) apply to him since he is not Canadian citizen? I understand he is considered Canadian resident for tax purpose for Jun 2010-Jul 2012. His tie to Canada should be considered severed after he left Canada in Jul (he had no RRSP, heath coverage, or house). He didn't go to US right after he left Canada. He went home in Germany. Should we use US Germany treaty instead of US Canada treaty to exclude his income from Canada? But he wasn't German resident for tax purpose for over 5 years because he was living in Switzerland.
2. Can he claim me as a dependent? We were not married in 2012 but have been living together in 2012 except Aug 2012 when I was staying in Canada handling his moving.
3. In Canada he always received T4A instead of T4 and he paid tax on all his T4A income. If US Canada treaty applies to him does Form 2555 cover post doc income (I read form 2555 only applies to employment income)?
Canada side:
1.When he files his exit return for 2012 is his departure date considered mid Jul when he actually left or end of Aug when he finished his apartment rental term?
2. Because I was on visiting status starting last Sept and we were not married, I believe I don't need to file any return for US for 2012. I will still file normal T1 for 2012 instead of an exit return. But for my 2013 Canada return, do I file my exit return using Feb 2013, the time I change from B2 to H4, as the time I cut my tie to Canada? I have no income after Mar 2012 and have stayed in US starting Sept 2012. The only time I left USA was the one day cross border trip for my H4. I have only bank account, RRSP, and a couple of Canadian credit cards, and haven't used heath care from Canada since Sep 2012.
Thanks for your suggestions!!
US Canada Germany treaty?
Moderator: Mark T Serbinski CA CPA
Re: US Canada Germany treaty?
[quote="echo"]My husband and me are filing our first year tax return in US. I was wondering if somebody could help us out with some questions we have.
My husband is German citizen who worked in Switzerland for 5 years before coming to Canada in Jun 2010 for a university post doc position. He finished his postdoc in Canada at end of May 2012 but stayed in Canada till Mid Jul as a tourist before heading back to Germany to get his H1B visa. He started his job in Mid Aug 2012. I joined him in US in Sept 2012 as a visitor and we got married in Feb this year and I changed my status to H4.
I did some research here and know that we might have 3 options to file his 2012 US return: because he doesn't meet the 183 days rule he can file NR alien, dual status through first choice, or resident alien using 2555/1116.
US return:
1. Does US Canada tax treaty (especially form 2555/1116) apply to him since he is not Canadian citizen? I understand he is considered Canadian resident for tax purpose for Jun 2010-Jul 2012. His tie to Canada should be considered severed after he left Canada in Jul (he had no RRSP, heath coverage, or house). He didn't go to US right after he left Canada. He went home in Germany. Should we use US Germany treaty instead of US Canada treaty to exclude his income from Canada? But he wasn't German resident for tax purpose for over 5 years because he was living in Switzerland.
2. Can he claim me as a dependent? We were not married in 2012 but have been living together in 2012 except Aug 2012 when I was staying in Canada handling his moving.
3. In Canada he always received T4A instead of T4 and he paid tax on all his T4A income. If US Canada treaty applies to him does Form 2555 cover post doc income (I read form 2555 only applies to employment income)?
Canada side:
1.When he files his exit return for 2012 is his departure date considered mid Jul when he actually left or end of Aug when he finished his apartment rental term?
2. Because I was on visiting status starting last Sept (we were not married) and I don't meet 183 day rule for 2012, I believe I don't need to file any return for US for 2012. I will still file normal T1 for 2012 instead of an exit return. But for my 2013 Canada return, do I file my exit return using Feb 2013, the time I change from B2 to H4, as the time I cut my tie to Canada? I have no income after Mar 2012 and have stayed in US starting Sept 2012. The only time I left USA was the one day cross border trip for my H4. I have only bank account, RRSP, and a couple of Canadian credit cards, and haven't used heath care from Canada since Sep 2012.
Thanks for your suggestions!![/quote]
My husband is German citizen who worked in Switzerland for 5 years before coming to Canada in Jun 2010 for a university post doc position. He finished his postdoc in Canada at end of May 2012 but stayed in Canada till Mid Jul as a tourist before heading back to Germany to get his H1B visa. He started his job in Mid Aug 2012. I joined him in US in Sept 2012 as a visitor and we got married in Feb this year and I changed my status to H4.
I did some research here and know that we might have 3 options to file his 2012 US return: because he doesn't meet the 183 days rule he can file NR alien, dual status through first choice, or resident alien using 2555/1116.
US return:
1. Does US Canada tax treaty (especially form 2555/1116) apply to him since he is not Canadian citizen? I understand he is considered Canadian resident for tax purpose for Jun 2010-Jul 2012. His tie to Canada should be considered severed after he left Canada in Jul (he had no RRSP, heath coverage, or house). He didn't go to US right after he left Canada. He went home in Germany. Should we use US Germany treaty instead of US Canada treaty to exclude his income from Canada? But he wasn't German resident for tax purpose for over 5 years because he was living in Switzerland.
2. Can he claim me as a dependent? We were not married in 2012 but have been living together in 2012 except Aug 2012 when I was staying in Canada handling his moving.
3. In Canada he always received T4A instead of T4 and he paid tax on all his T4A income. If US Canada treaty applies to him does Form 2555 cover post doc income (I read form 2555 only applies to employment income)?
Canada side:
1.When he files his exit return for 2012 is his departure date considered mid Jul when he actually left or end of Aug when he finished his apartment rental term?
2. Because I was on visiting status starting last Sept (we were not married) and I don't meet 183 day rule for 2012, I believe I don't need to file any return for US for 2012. I will still file normal T1 for 2012 instead of an exit return. But for my 2013 Canada return, do I file my exit return using Feb 2013, the time I change from B2 to H4, as the time I cut my tie to Canada? I have no income after Mar 2012 and have stayed in US starting Sept 2012. The only time I left USA was the one day cross border trip for my H4. I have only bank account, RRSP, and a couple of Canadian credit cards, and haven't used heath care from Canada since Sep 2012.
Thanks for your suggestions!![/quote]
The german tax treaty has identical rights as Canadian. besides, you are Cdn, so you have the right, thus so does he, to file jointly.
File jointly, and use 2555, just like an american would.
File jointly, and use 2555, just like an american would.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
[quote="nelsona"]sorry, did not read your long post completely. He can file full-year if he wishes, you will file jointly for 2013.[/quote]
Thanks for your reply and sorry for the long post.
This means he can use form 2555/1116 to exclude his Canadian income if he chooses to file full year 1040? Does US Germany treaty also use form 2555/1116? also Im not sure if his post doc T4A income is considered employment income (he has been paying tax on it in Canada)
I plan to file T1 return for 2012 because I was only travellng to usa in 2012 (changed status from B2 to H4 only this Feb). But 'm not sure for 2013 I should file an exit return to Canada or treat myself as a non resident of Canada for the full year of 2013 per US Canada treaty?
Thanks for your reply and sorry for the long post.
This means he can use form 2555/1116 to exclude his Canadian income if he chooses to file full year 1040? Does US Germany treaty also use form 2555/1116? also Im not sure if his post doc T4A income is considered employment income (he has been paying tax on it in Canada)
I plan to file T1 return for 2012 because I was only travellng to usa in 2012 (changed status from B2 to H4 only this Feb). But 'm not sure for 2013 I should file an exit return to Canada or treat myself as a non resident of Canada for the full year of 2013 per US Canada treaty?
I just said german treaty had same provison, did I not?
As to whether he can use 2555, he has to satisfy the physical presence test to use 2555, just like any american. He can always use 1116.
For cdn departure, both you and he have a departure date. His wehn he left, yours when you left and got H4.
As to whether he can use 2555, he has to satisfy the physical presence test to use 2555, just like any american. He can always use 1116.
For cdn departure, both you and he have a departure date. His wehn he left, yours when you left and got H4.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best