[quote="nelsona"]
You are EITHER a US resident, or a Cdn one. Pick one and go with it.[/quote]
I was thinking to myself: " Why is Nelson saying that I have claimed to not be a resident of either country, where did I say I'm not a US resident?" Then, I remembered taking the foreign tax credit with the IRS in 2005!
Ok, so for 2006 and beyond, I'd like to be a US resident and Canadian deemed resident to keep things consistent on the CRA side.
Checklist:
1. That'd mean that on my 1040, instead of taking the foreign tax credit, I'll have to deduct Canada taxes - since US foreign tax credit requires me to be a Canada resident, correct?
2. Maybe I should also file the IRS "Certification of Residency" form: form 8802
http://www.irs.gov/publications/p686/ar02.html
What do you think?
US Citizen, filing as "deemed resident"
Moderator: Mark T Serbinski CA CPA
If your income was from canada, then it is foreign income, regardless of where you live. You don't have to be living outside US to claim foreign tax credit. in act, in some cases you don't even have to have foreign income. What you need is FOREIGN TAX, which you have.
So, you DO live in US, thus can't be a deemed resident of canada. Or you DON't live in US, and thus live in canada, so you aren't a deemed resident.
I think the big problem you would have is if Ontario would ever find out that you are skipping out on their share of the taxes. I assume you have OHIP (which is further proof of living in Ontario).
Indeed the GUIDE states that deemed residents don't pay Prov tax on wages. I think the guide may be wrong on this, since they are really speaking about deemed residents in the context of employees not living in Canada.
If non-residents have to pay Prov tax on wages, so do deemed residents (due to 183 days). But this doesn't really apply to you.
You do live in canada.
Just to recap:
Deemed resident:
1- stay in Canada for 183 days or more in that tax year;
2- don't have residential ties with Canada; and
3- aren't considered a resident of another country under the terms of a tax treaty.
You do have residential ties in canada (so you fail 2), and if you have stronger ties in US, then you are resident of US, so you fail 3.
So, you DO live in US, thus can't be a deemed resident of canada. Or you DON't live in US, and thus live in canada, so you aren't a deemed resident.
I think the big problem you would have is if Ontario would ever find out that you are skipping out on their share of the taxes. I assume you have OHIP (which is further proof of living in Ontario).
Indeed the GUIDE states that deemed residents don't pay Prov tax on wages. I think the guide may be wrong on this, since they are really speaking about deemed residents in the context of employees not living in Canada.
If non-residents have to pay Prov tax on wages, so do deemed residents (due to 183 days). But this doesn't really apply to you.
You do live in canada.
Just to recap:
Deemed resident:
1- stay in Canada for 183 days or more in that tax year;
2- don't have residential ties with Canada; and
3- aren't considered a resident of another country under the terms of a tax treaty.
You do have residential ties in canada (so you fail 2), and if you have stronger ties in US, then you are resident of US, so you fail 3.
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
No, You are definitely a Cdn (and Ontario resident).
Kudos, for getting a way with it for 1 year, but this scratching after the dependant credit has merely alerted them to your case. When you file an Nr74 as requested, it will become clear.
Kudos, for getting a way with it for 1 year, but this scratching after the dependant credit has merely alerted them to your case. When you file an Nr74 as requested, it will become clear.
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]I think the big problem you would have is if Ontario would ever find out that you are skipping out on their share of the taxes. I assume you have OHIP (which is further proof of living in Ontario). [/quote]
But that's why i am paying the federal surtax. Canada is not losing out on me by me getting on the national healthcare system. Yes, I have OHIP (to directly address your assumption).
[quote]Just to recap:
Deemed resident:
1- stay in Canada for 183 days or more in that tax year;
2- don't have residential ties with Canada; and
3- aren't considered a resident of another country under the terms of a tax treaty.
You do have residential ties in canada (so you fail 2), and if you have stronger ties in US, then you are resident of US, so you fail 3.[/quote]
I see what you are saying now.
So if I argue against #2 (meaning "factual resident") and thereby claim myself as a US resident (and therefore pass #3), what I end up doing is declaring myself a deemed non-resident? That's why you mentioned the non-resident classification in an earlier post...
My head is spinning now..and we didn't even talk about the credit....
But that's why i am paying the federal surtax. Canada is not losing out on me by me getting on the national healthcare system. Yes, I have OHIP (to directly address your assumption).
[quote]Just to recap:
Deemed resident:
1- stay in Canada for 183 days or more in that tax year;
2- don't have residential ties with Canada; and
3- aren't considered a resident of another country under the terms of a tax treaty.
You do have residential ties in canada (so you fail 2), and if you have stronger ties in US, then you are resident of US, so you fail 3.[/quote]
I see what you are saying now.
So if I argue against #2 (meaning "factual resident") and thereby claim myself as a US resident (and therefore pass #3), what I end up doing is declaring myself a deemed non-resident? That's why you mentioned the non-resident classification in an earlier post...
My head is spinning now..and we didn't even talk about the credit....
[quote="nelsona"]No, You are definitely a Cdn (and Ontario resident).
Kudos, for getting a way with it for 1 year, but this scratching after the dependant credit has merely alerted them to your case. When you file an Nr74 as requested, it will become clear.[/quote]
I don't have to file the NR-73: that's not a requirement. And they did send me the letter asking for all dates outside of Canada and I gave them and never heard back. So they accepted my declaration of deemed resident status for 2005.
Kudos, for getting a way with it for 1 year, but this scratching after the dependant credit has merely alerted them to your case. When you file an Nr74 as requested, it will become clear.[/quote]
I don't have to file the NR-73: that's not a requirement. And they did send me the letter asking for all dates outside of Canada and I gave them and never heard back. So they accepted my declaration of deemed resident status for 2005.
You should be filing as a Cdn living in Ontario. Period.
You are entitled to any deduction or credit for your brother that you would be entitled to if he lived away from you but in canada.
In US, simply use the Cdn tax as a credit, or, better yet (if you have no children -- not your brother) file using the foreign earned income exclusion (FEIE) with form 2555.
You completely misinterpreted what a deemed resident was.
You are entitled to any deduction or credit for your brother that you would be entitled to if he lived away from you but in canada.
In US, simply use the Cdn tax as a credit, or, better yet (if you have no children -- not your brother) file using the foreign earned income exclusion (FEIE) with form 2555.
You completely misinterpreted what a deemed resident was.
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
You are indeed paying your share FEDERALLY, but that is why I said Ontario would be intersted.
NR74 is for your case, not NR73. You would have to send it if CRA asked for it.
NR74 is for your case, not NR73. You would have to send it if CRA asked for it.
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
Hey nelsona,
I've been thinking about this for the past 2 days - the negative thing i see out of me filing as an ON resident in 2006 would be that the CRA could re-assess me for 2005 and i'll owe them $1200. They'd also be curious regarding why i keep changing my filing status. Should i really rock the boat?
Also, i'm getting a fat refund (8k almost) since I loaded my RRSP in 2006. I think I should hold off on deducting my brother for this year. They'll probably ask me for a lot of documentation including my 1040 and so on. I'd like to avoid providing that to them.
I've been thinking about this for the past 2 days - the negative thing i see out of me filing as an ON resident in 2006 would be that the CRA could re-assess me for 2005 and i'll owe them $1200. They'd also be curious regarding why i keep changing my filing status. Should i really rock the boat?
Also, i'm getting a fat refund (8k almost) since I loaded my RRSP in 2006. I think I should hold off on deducting my brother for this year. They'll probably ask me for a lot of documentation including my 1040 and so on. I'd like to avoid providing that to them.