TN status, taxes and ObamaCare

snnybrr · Post by **snnybrr** » Thu Jan 12, 2017 10:19 am

- I'll empty out my TFSA
- I don't need to get a NJ driver's licence because I won't be driving here
- I'll speak with Service Ontario for OHIP continuation when I'm in Canada this weekend
- On my 2016 filing, I'll indicate the date I left Canada. I have no US income in 2016 so that simplifies things
- Everything else remains as is

Do you think I've missed anything? Does RRSP remain non-impacted?

nelsona · Post by **nelsona** » Thu Jan 12, 2017 11:59 am

RRSP is fine. I would check with the manager whether they accepts US clients. Most do not.

snnybrr · Post by **snnybrr** » Thu Jan 12, 2017 5:10 pm

If I leave my RRSP as is and don't contribute anything to it in 2017, would I have to report any earnings on my US filing? Alternatively, can I continue contributing to my RRSP?

nelsona · Post by **nelsona** » Thu Jan 12, 2017 5:51 pm

You only report to IRS when you take money OUT of your RRSP.
It is generally not wise to contribute to RRSP while non-resident, since you aren't taxable in Canada. You could do the late contribution for 2016 up until March 1. But you need to check with your RRSP manager, and you need to tell them your US address.

snnybrr · Post by **snnybrr** » Thu Jan 12, 2017 9:38 pm

How do my CPP contributions get affected? Do I still need to contribute?

I'm now making contributions into the US Medicare/OASDI. Do I need to contribute to just this or both? When time comes to get my pension, how would this work?

nelsona · Post by **nelsona** » Fri Jan 13, 2017 10:52 am

Since you are an employee, you r paying FICA, and you don't pay CPP. In any event, you won't be reporting any US income to CRA, becaue you left Canada,.

snnybrr · Post by **snnybrr** » Tue Jan 17, 2017 11:42 am

An update/FYI for people in the same boat:

I went to ServiceOntario to keep my OHIP card active. A couple of people weren't sure about the exact rules, but I also called to confirm. You can reach out to ServiceOntario after you've left Canada, and can keep the card active for up to 5 years at a time and for the same foreign country. If you return for any amount of time (after your contract, and without getting additional employment), you'd have to live in Ontario for a certain amount of time to be able to reapply for keeping the card active.

They require proofs of your Canadian address, your passport, a letter from your foreign employer stating your start and end dates, and a ServiceOntario form (Change of Information). They don't accept photocopies of the employer letter and the form.

This information can be submitted in person at some ServiceOntario locations as well as via mail:

ServiceOntario (OHIP Absences)
435 James Street S
Suite 113
Thunder Bay, ON
P7E 6T1

nelsona · Post by **nelsona** » Tue Jan 17, 2017 11:59 am

Yes, thatnks for the details.
But, remember that this doesn't provide you with adequate US coverage.

snnybrr · Post by **snnybrr** » Tue Jan 17, 2017 12:01 pm

Yup, also signed up for a US health plan, the costs for which should be covered by potential tax savings by not filing in Canada.

snnybrr · Post by **snnybrr** » Tue Jan 17, 2017 5:54 pm

Another question...

Seeing that I have an RRSP to which I'll no longer be contributing until/unless I move back, can I contribute to something similar in the US for tax deferrals? My employer does not have a retirement plan.

nelsona · Post by **nelsona** » Tue Jan 17, 2017 10:00 pm

Ira or Roth IRA

snnybrr · Post by **snnybrr** » Thu Jan 26, 2017 1:13 pm

Another question that popped into my head: How exactly would the departure tax work?

I'll be retaining my house in Canada. I have transferred money out of the TFSA, and I have a small RRSP account. Beyond this I have a car (~$20,000) and other personal items not more than $10,000. Technically, nothing with capital gains.

nelsona · Post by **nelsona** » Thu Jan 26, 2017 1:29 pm

Then it will be simple. But do realize that you will not be able to claim exemption from gains on your house in Canada after you leave. This will result in some gains atx when you sell, but only on the portion after you've left.
CRA has instructions for departure returns, and ufile, for one, handles these returns correctly.

snnybrr · Post by **snnybrr** » Thu Jan 26, 2017 1:36 pm

I own 33% of the house, with the remainder owned by non-dependents. So, when I sell, I'd be taxed on gains on the 33% since my departure in 2016. How is this market value difference calculated?

Otherwise, no tax unless I sell, right?

nelsona · Post by **nelsona** » Thu Jan 26, 2017 1:56 pm

You need to gat a solid FMV evaluation of your property for the time you left, and keep this in your files.