Capital gains in the US while living in Canada

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danielc
Posts: 1
Joined: Sat Jun 30, 2018 3:28 pm

Capital gains in the US while living in Canada

Post by danielc »

Hello,

Suppose I am a Canadian living in the US. I buy a stock in the US for $100. A few years later it appreciates to $130. Then I move back to Canada, and keep the stock untouched at the US broker. Then it appreciates to $150. Then I sell it.

Question: What tax do we owe and to whom?

- The first $30 of appreciation occurrs while I'm in the states. Does that mean that the US will want to tax that?

- The stock gets sold while I'm in Canada. Does the US charge cap gains tax or witholding tax? Or neither? I read elsewhere that the US does not charge capital gains tax on non-residents.

- What tax rate would Canada charge? Capital gains or regular income? Would Canada see a $50 or a $20 cap gain? (i.e. is the capital gain counted relative to when I bought the stock or relative to when I moved?)

I would be grateful for any information you might offer.

Cheers.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Capital gains in the US while living in Canada

Post by nelsona »

The gains while in US would nothe taxed at all, if you were no longer resident there ( and not aGC ir USCitizen)
When you returned to Canada, your stock wiuld be re-evaluated at $130 for Cdn tax putposes, so when you eventually solduiu woukd owe Canada only on the gain after $130
Tjis is a known strategy for Canadian returning ti Canada after living in US
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
gang.sun
Posts: 4
Joined: Sun Aug 05, 2018 1:37 am

Re: Capital gains in the US while living in Canada

Post by gang.sun »

So no one tax the first $30. Right?
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Capital gains in the US while living in Canada

Post by nelsona »

correct. As long as neither of you are required to file as residents of US.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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