My husband left Canada mid January 2006, and I could only leave in October 2006. While most of his earnings and tax was paid in the US, mine are in Canada.
Can we get around double taxation by having separate filing where we are 'married filing separately in the US', and declaring my total income as well as his two weeks income in Canada?
What happens to RRSP repayments from the HBP? As we were no more residents, our financial institution informed us that we could no more contribute to an RRSP (repay our HBP).
Is this easily done with electronic filing? Any software recommendation is welcome. Thanks!
Dual residence for married couple?
Moderator: Mark T Serbinski CA CPA
Don't count me as an expert.
I was just a few hours earlier than you to hook to this forum.
Anyway here is what I thought:
- Your husband can file as resident alien for all his US income
- Your husband's Canadian income can be claimed as Foreign income,
and you can do foreign income exclusion on that.
- You can file the income you got from US as non-resident alien.
- You need to file Canadian resident income since you stayed there over 183 days.
That's all I have.
Good luck.
Allen
I was just a few hours earlier than you to hook to this forum.
Anyway here is what I thought:
- Your husband can file as resident alien for all his US income
- Your husband's Canadian income can be claimed as Foreign income,
and you can do foreign income exclusion on that.
- You can file the income you got from US as non-resident alien.
- You need to file Canadian resident income since you stayed there over 183 days.
That's all I have.
Good luck.
Allen
To clarify most -- if not all -- of what allen has said:
Your husband should file a normal 1040, declaring ALL world income for 2006. He should also declare all your world income. The Cdn WAGES either of you made should be excluded by using form 2555, but it must be reported.
This is a joint return.
Both you and husband need to file Cdn returns. You need to file with a departure date in October. Your husband *probably* needs to do the same, especially if he did not by/rent a home in US unrtil October. Working in US does not necessarily mean that residency ios terminated. If he does have to file until OCtober, then he will haqve to report the US income in canad as well.
Please read other posts on this site. You have left your taxes too late.
The number of days spent in Canad is immaterial when you lived in Canada during the year, either ariving or departing. The 183 day rule is for people who don't live in Canada.
There is no such rule as reporting incvome in only one place.
Your husband should file a normal 1040, declaring ALL world income for 2006. He should also declare all your world income. The Cdn WAGES either of you made should be excluded by using form 2555, but it must be reported.
This is a joint return.
Both you and husband need to file Cdn returns. You need to file with a departure date in October. Your husband *probably* needs to do the same, especially if he did not by/rent a home in US unrtil October. Working in US does not necessarily mean that residency ios terminated. If he does have to file until OCtober, then he will haqve to report the US income in canad as well.
Please read other posts on this site. You have left your taxes too late.
The number of days spent in Canad is immaterial when you lived in Canada during the year, either ariving or departing. The 183 day rule is for people who don't live in Canada.
There is no such rule as reporting incvome in only one place.
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
Hi Nelsona
For the case of ca_usa, is it possible for her husband to be using first-year choice as dual-status filing separately,
NR for the first part of the year, and resident for the second part of the year,
for herself, she just files as NR?
As for CPA, both of them have to file as well?
My concern is with FEIE if they MJF as resident for the whole year,
the stacking provision eats a lot for the wife's income from Canada.
THe otherside of the coin was that if the husband uses dual-status, he can not get standard deduction. Am I right?
Please advise.
Allen
For the case of ca_usa, is it possible for her husband to be using first-year choice as dual-status filing separately,
NR for the first part of the year, and resident for the second part of the year,
for herself, she just files as NR?
As for CPA, both of them have to file as well?
My concern is with FEIE if they MJF as resident for the whole year,
the stacking provision eats a lot for the wife's income from Canada.
THe otherside of the coin was that if the husband uses dual-status, he can not get standard deduction. Am I right?
Please advise.
Allen
Dual status almost never gives a good result, since it still prevents standard deduction. By the way, he wouldn't be usuing the first year choice, since he meets SPT in 2006. First-year choice is for those arriving late in the tax year.
If stacking gives rise to US tax, then FTC might be a better way to go. FEIE is merely simpler than FTC, but now, I encourage almost all US citizens living in Canada who have more than the FEIE limit in income -- or who have children -- to use FTC. Its complicated, but at least tax is zero on Cdn income -- or very close to it.
And, yes, they both have to file in canada, since they were resident there at least for part of the year. They are "Emigrants" and thus need to fiel a departure return, along with other forms. The only question is when husband will be considered to have left canada. Unless he only visted canada rarely between january and october, and he established a HOME in US, he will be considered as having left in October, and be required to report his US earnings until then. Otherwise he may be able to argue tha the left in january. But he would still need to file a departure return in canada for 2006.
If stacking gives rise to US tax, then FTC might be a better way to go. FEIE is merely simpler than FTC, but now, I encourage almost all US citizens living in Canada who have more than the FEIE limit in income -- or who have children -- to use FTC. Its complicated, but at least tax is zero on Cdn income -- or very close to it.
And, yes, they both have to file in canada, since they were resident there at least for part of the year. They are "Emigrants" and thus need to fiel a departure return, along with other forms. The only question is when husband will be considered to have left canada. Unless he only visted canada rarely between january and october, and he established a HOME in US, he will be considered as having left in October, and be required to report his US earnings until then. Otherwise he may be able to argue tha the left in january. But he would still need to file a departure return in canada for 2006.
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