Need help with filling 1040NR

[nelsona]

Your foreign tax for Cdn purposes is the result of your tax return and hjas nothing to do with what was withheld or refunded. It is the tax that was calculated

[Canada06]

HI Nelsona,
Thank for your input earlier. I filed my US tax as non resident , Single and Canadian tax as resident, joint for the year 2015.

Now this year, i was planning on going back to Canada but instead I will be staying here as my employer offered me fulltime and also my husband got a job offer here in US. So I have few questions regarding my Canadian accounts
1. Before my husband moves here, when both of us will become non resident of Canada, I want to take care of my bank accounts to get minimum tax. Here is what I am thinking. Please provide your input.
a. Close TFSA ~ 30K CAD. -- I don’t want to convert this money to US because of the current exchange rate. Is there any suggestion on this ?
b. RRSP ~ 100K CAD – can I keep it in canada as I don’t need this money in near future
c. RESP ~15K Not sure what happens with this. Should I close it before becoming US resident or after I become US resident? What will happen to the money that Canada govt has contributed?
d. I shouldn’t keep more than 10000 in my Canadian account to eliminate tax filing in Canada right?
e. We are thinking of selling the house. Should we sell it before we become US resident ot after we become US resident?
2. I need to file emigration tax return for Canada for the year 2016 right?.


Thank you in advance

[nelsona]

1. bank accounts don't incur tax, so don't worry about them.
a. Close TFSA and put in Cdn bank, if you don't want it in US.
b. sure.
c. transfer to one of your parents.
d. The amount of money you have in Canada doesn't have any bearing on whether you have to filer a tax return in Canada. Once you file your departure return, you are done for filing Cdn taxes, unless you have (a) Cdn job income, or (b) sell Cdn real estate.
e. Sell when you get your price. It is easier to sell a house when you live in it.
2. Yes. It will be based on the date you move to US.

[Canada06]

Thank you for the quick response Nelsona.


1. So for Canadian bank account and TFSA, I can keep them in Canada. But while filing tax in US? Should I report them and pay taxes on the interest?
2. Regarding RESP, I don’t have any relatives in Canada So what can be my option?
3. Regarding the house, when will I get most tax advantage? If I sell before becoming US resident, we don’t get an tax on the capital gain as per the Canada rule right? But if I sell it after I become the US resident, don’t I have to pay taxed on the gain in US?

[nelsona]

1. You read what I said. Close the TFSA. As a US resident, you pay tax on world income, so you will report any interest on your US return.
2. I would close it.
3. There is no Cdn tax on your house if you sell up to one year after leaving. There will be no US tax on the house if you sell with 3 years of leaving. So tax is not the issue. Selling an empty house from 1000 miles away is the issue.

[Canada06]

thanks Nelsona

[tony]

Does it mean:
1. if i stay in us < 183 days (in year 1), i have an option to file 1040NR OR 1040.
2. what are the advantages? of filing 1040 if I stay < 183 days? Is the tax rate lower?

[nelsona]

1/2. If you do not meet SPT in your move year, you can file 1040NR, which avoids all the foreign reporting issues that you are facing otherwise. You probably pay a little higher tax rate, but could be worth it.