Timing the Return to the US

[PlatinumNeon]

Hello,

are there any practical considerations on timing my return back to my US residence after 4 years in Canada?

i.e. if I make my move date/end the residency in Canada before July1 2022 (less than 183 days in a calendar year),
do I still have to file Canadian taxes for 2022?

Thank you!

[nelsona]

You still have to file a departure return regardless of how many days you spent in Canada in that year. The one thing you would be looking for is that you move away before getting any US-sourced income, so that you do not have to report this on your final CDn return.

[PlatinumNeon]

My sole sources of income is from the US only, even though I have a current residence status in Canada. So whether I move on June 30th or July 15th won't make any difference?

[nelsona]

Well, as I said in my initial response, the soomer you leave, the less US income you will need to report, since you continue to report US income to CRA until you move.

[ND]

"My sole sources of income is from the US only, even though I have a current residence status in Canada. So whether I move on June 30th or July 15th won't make any difference?"
source for CPAs means where IRC sources the income. For example, a US company entirely funding the sole pay of a Cdn resident who physically works only in Canada, constitutes Cdn source income, not US source income. I suspect this is your case and you're not looking at the applicable definition of 'source'.

[nelsona]

From what I recsll, Platinum is a commuter to the US. Even if they have been staying at home diring covid, CRA has bought off that this remains US-sourced.

In any event, as I said twice now, the earlier they leave Canada, the less CDn tax they will pay, regardless of the source.

[PlatinumNeon]

Nelsona is sharp as a tack.

So in 2023 I will still have to file the CDN tax return for 2022 but the CDN tax requirement will be applicable only up to the date whenever I leave in 2022 (even if it's only 5 months for example). I think I got it. Thank you.

[nelsona]

Yes. Since this will be your departure return, you will be subject to the requirements of that return (ie. deemed disposition, cessation of any Govt benefits, GST rebate, CCB,etc).

[PlatinumNeon]

I dont have any cdn gov benefits, gst rebates and such; not keeping any ties to Canada for that reason, or keeping them to unavoidable minimum (spouse and children). however, the whole point of returning back to the US is to exactly avoid forced deemed disposition - as it will be less than 5 years in Canada ...did I miss something?

[nelsona]

Doesn't change my answer. Avoidance of deemed disposition applies only to investments you held before entering canada. Yes, you can use this for stay of a 5 years (60 months) or less.