First time poster, regular visitor.
I have managed to digest all the information I needed in the past from this forum through the search facility, except this one little pebble that is stuck in my shoe.
Background:
I renounced my US citizenship (450 bucks usd) on October 08th 2012..
Filed, (or about to file) 1040 and 1040 nr
Question:
The completed tax package from my Accountant has my 1040 calculated from Jan 01 to October 8, 2012 and my 1040nr from October 8 to Dec 31 2012.
Is it ok to overlap this October 8th date as he obviously did?............i suppose one could make the case that i was a US citizen up to and including 2pm on the 8th...then no longer a citizen from 2pm on.
Its the weekend....they are closed...and hoping i can secure some insight before Monday morning when I intend to mail the package.
Thanking everyone and anyone in advance who decides to respond.
1040/1040nr
Moderator: Mark T Serbinski CA CPA
Techically, your 1040 is up until october, but you 1040NR is for the entire year (wiith numbers from 1040 transferred to it,
So, since there is no starting date on the 1040NR, I wouldn;tr worry about this.
So, since there is no starting date on the 1040NR, I wouldn;tr worry about this.
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
Thaks Nelsona,
Please let me clarify as there is a start and end date on the 1040 nr
at the top of page 1 (1040) he (accountant) has tax date written as Jan 01 2012 and ending Oct 8 2012.
at the top page 1, 1040 nr he has tax date written as Oct 8 2012 to dec 31 2012.
this is the overlap (october date) i was referring to.
I think what you are saying is that the 1040 should reflect a date from Jan 01 2012 to October 8 2012 (as it currently does)
and the 1040 nr should just reflect a date for the entire year ?..
In other words don't fill in any of the blanks at the top page where it asks for beginning and end tax dates, but rather leave them blank and go with the (already written on the form) "for the year Janurary 1-december 31, or other tax year" ?
Please let me clarify as there is a start and end date on the 1040 nr
at the top of page 1 (1040) he (accountant) has tax date written as Jan 01 2012 and ending Oct 8 2012.
at the top page 1, 1040 nr he has tax date written as Oct 8 2012 to dec 31 2012.
this is the overlap (october date) i was referring to.
I think what you are saying is that the 1040 should reflect a date from Jan 01 2012 to October 8 2012 (as it currently does)
and the 1040 nr should just reflect a date for the entire year ?..
In other words don't fill in any of the blanks at the top page where it asks for beginning and end tax dates, but rather leave them blank and go with the (already written on the form) "for the year Janurary 1-december 31, or other tax year" ?
I suppose me confusion is to ensure he has written the correct information, (or should i say the correct beginning and end tax dates) on the top of page 1 on both the 1040 and 1040 nr...
i understand that the 1040 is most likely correct as it is from jan 1 to dec 31.
the 1040 nr i can always correct myself
i understand that the 1040 is most likely correct as it is from jan 1 to dec 31.
the 1040 nr i can always correct myself
The 1040NR is for the entire year. The world income from pre-October 8th shown on 1040 is brough on to 1040NR, along with any US-sourced income from post october 8, and then tax is calculated by the 1040NR.
I'm curious as to why your acct didn't simply file a full year 1040, which is your right, and would probbaly have lead to a lower US tax (and simpler report).
I'm curious as to why your acct didn't simply file a full year 1040, which is your right, and would probbaly have lead to a lower US tax (and simpler report).
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
Nelsona you raised an interesting point with respect to your comment:
"The 1040NR is for the entire year. The world income from pre-October 8th shown on 1040 is brough on to 1040NR, along with any US-sourced income from post october 8, and then tax is calculated by the 1040NR".
With respect to the pre-october 8th income (which in my case was all generated in canada), where on the 1040NR would one place this world income...if such income was never generated or connected to the united states?
The reason I ask, is that page 1 of the 1040 nr specifically states to list "income effectively connected with US trade/business" and on my form he (Accountant) has left these lines blank as i had no income connected to the aformentioned.
Did he fill this out incorrectly?
"The 1040NR is for the entire year. The world income from pre-October 8th shown on 1040 is brough on to 1040NR, along with any US-sourced income from post october 8, and then tax is calculated by the 1040NR".
With respect to the pre-october 8th income (which in my case was all generated in canada), where on the 1040NR would one place this world income...if such income was never generated or connected to the united states?
The reason I ask, is that page 1 of the 1040 nr specifically states to list "income effectively connected with US trade/business" and on my form he (Accountant) has left these lines blank as i had no income connected to the aformentioned.
Did he fill this out incorrectly?
The 1040NR is for the entire year. The world income from pre-October 8th shown on 1040 is brough on to 1040NR, along with any US-sourced income from post october 8, and then tax is calculated by the 1040NR.
Dualupet
be it far from me to interpret someone else's thread, but I don't think income that is not related to United States trade or business goes on 1040NR. This comment seems to clearly identify that it does.
I can only tell you what I did from help off this forum; I filed a 1040 until my renouncement date, then a 1040NR after that. Since I had no us income after the renounce date, the 1040NR was all zero's.
Dualupet
be it far from me to interpret someone else's thread, but I don't think income that is not related to United States trade or business goes on 1040NR. This comment seems to clearly identify that it does.
I can only tell you what I did from help off this forum; I filed a 1040 until my renouncement date, then a 1040NR after that. Since I had no us income after the renounce date, the 1040NR was all zero's.
Clearly advising you to place your pre-October (non-US income) on the 1040NR is a mistake, I can only assume this was a fumble in wording alone.
This excerpt was copied directly from Phil Hodgens forum regarding renouncing ones citizenship and the tax implications:
The filing deadline is the same as it always is. For Americans abroad it is June 15 of the next year, and extensions are possible. The tax return is a dual-status tax return (see Chapter 6 of IRS Publication 519) consists of three parts:
- Form 1040 for January 1 through the day that you terminated your citizenship (usually the day of your exit interview at the Embassy). Report your income normally, as a U.S. taxpayer usually would.
- Form 1040NR for the day after your exit interview through December 31. Report your income like any other nonresident/noncitizen of the United States on the planet. Generally this means that you only report (and pay U.S. income tax on) income you received from U.S. sources
so as you can see it appears your Acc. got it right, you only report income you recieved from u.s. sources.
Since it appears from your post that all your income is Canadian based, then you would not have any values on any Line of the 1040NR, except maybe your personal exemption on line 40.
As for what date to place at the top of the form (1040NR), i do not think you ccould go wrong with Nelsonas advice of leaving it "jan1 to Dec 31 2012" as your schedule OI will clear any confusion as to when you became a non-US citizen (NRA).
Hope this helps
This excerpt was copied directly from Phil Hodgens forum regarding renouncing ones citizenship and the tax implications:
The filing deadline is the same as it always is. For Americans abroad it is June 15 of the next year, and extensions are possible. The tax return is a dual-status tax return (see Chapter 6 of IRS Publication 519) consists of three parts:
- Form 1040 for January 1 through the day that you terminated your citizenship (usually the day of your exit interview at the Embassy). Report your income normally, as a U.S. taxpayer usually would.
- Form 1040NR for the day after your exit interview through December 31. Report your income like any other nonresident/noncitizen of the United States on the planet. Generally this means that you only report (and pay U.S. income tax on) income you received from U.S. sources
so as you can see it appears your Acc. got it right, you only report income you recieved from u.s. sources.
Since it appears from your post that all your income is Canadian based, then you would not have any values on any Line of the 1040NR, except maybe your personal exemption on line 40.
As for what date to place at the top of the form (1040NR), i do not think you ccould go wrong with Nelsonas advice of leaving it "jan1 to Dec 31 2012" as your schedule OI will clear any confusion as to when you became a non-US citizen (NRA).
Hope this helps
I renounced in November and am about to file a complete 1040 return for the full year - no 1040NR. I find posts in this thread a little confusing, since so many people take the dual form (1040 and 1040NR) return route, when it seems the single 1040 return is the easier approach. I hope I haven't missed something important.
I could understand if you won a big lottery prize the day after you renounced, but for those who renounce late in the year, it just seems the single 1040 approach is so much easier.
If anyone thinks I am making a mistake, please let me know.
I could understand if you won a big lottery prize the day after you renounced, but for those who renounce late in the year, it just seems the single 1040 approach is so much easier.
If anyone thinks I am making a mistake, please let me know.
I agree with you wholeheartedly.
If you were renouncing in ja/feb that would be one thing. But to go thru the effort to do dual status when renouncing in Oct-dec is a parting gift to IRS.
ut it this way, if you were a Cdn returning to canada in November after working in US, you would NEVER file dual status, you would file full-year 1040.
If you were renouncing in ja/feb that would be one thing. But to go thru the effort to do dual status when renouncing in Oct-dec is a parting gift to IRS.
ut it this way, if you were a Cdn returning to canada in November after working in US, you would NEVER file dual status, you would file full-year 1040.
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
I also agree, and would have done this if I had been more educated on the subject. But unfortunatley this is what my Firm left me with, so i will have to deal with it.
I did send a nasty email to them asking why they did not clarify, or more importantly did not type in any dates on either form (1040/1040NR), as for the money I spent it seems the least they could have done.
Or maybe I am just missing the point that it just doesn't matter what dates go on the form due to the fact that there is a lot of supporting information already in the package with respect to my renouncement.
Regardless, I will follow Nelsona's previous advice for the effective tax dates leaving the 1040NR for the entire year and the 1040 from jan01 to the date of renouncement.
Thank you everyone that put there 2 cents worth in.
I did send a nasty email to them asking why they did not clarify, or more importantly did not type in any dates on either form (1040/1040NR), as for the money I spent it seems the least they could have done.
Or maybe I am just missing the point that it just doesn't matter what dates go on the form due to the fact that there is a lot of supporting information already in the package with respect to my renouncement.
Regardless, I will follow Nelsona's previous advice for the effective tax dates leaving the 1040NR for the entire year and the 1040 from jan01 to the date of renouncement.
Thank you everyone that put there 2 cents worth in.