USC, tuition deduction

jmv55555 · Post by **jmv55555** » Thu Jan 17, 2013 9:12 pm

I'm a USC and paid tuition at a university in the US from 2008 - 2012. I moved to Canada in 2011 and deducted my 2011 tuition amount against income that year (and I can do it again for the 2012 return).

Can I back file 2008, 2009, and 2010 tax returns in Canada with no income but tuition amounts that roll over, so that I'm able to use them in coming years?

Thanks.

nelsona · Post by **nelsona** » Fri Jan 18, 2013 12:28 am

No. Only tuition expenses incurred while a resident of canada are eligible for the deduction/credit.
Technically, the tuition expenses incurred before your arrival date is ineligible, but CRA may have simply overlooked this on your 2011 newcomers return.

In fact, CRA has certain conditions on US or foreign tuition; best look into this before claiming these for 2012.

See: http://www.cra-arc.gc.ca/E/pub/tg/p105/p105-11e.pdf

jmv55555 · Post by **jmv55555** » Wed Jan 23, 2013 12:19 pm

Thank you for your help, Nelsona. A couple more clarifications would help my situation immensely:

(1) Is it possible to use foreign tax credits before tuition deductions on the Canadian return? I think I am in the situation where I'll have to pay more taxes to the US than to Canada.

(2) I will receive a bonus in March for work done mostly in 2012. In the US I have to prorate my bonus as part of my 2012 income, but it seems in Canada it only counts as 2013 income. So I have a mismatch here. Is it possible to prorate the bonus in Canada so I pay taxes on part of it in 2012?

I should also note I won't pass either the PPT or deemed resident test for tax year 2012, so I don't get the FEIC.

nelsona · Post by **nelsona** » Wed Jan 23, 2013 3:54 pm

(1) unfortunately, no.
(2) You do not pro-rate your bonus in US or canada. Where did you get this idea? Your W-2 is already complete.

nelsona · Post by **nelsona** » Wed Jan 23, 2013 3:57 pm

as for FEIE, if you want to use PPT you need to wait until you do meet the PPT. File an extension, and file when you meet PPT.

But you said you moved to canada in 2011. You should beable to use Bona fide test for all of 2012.

jmv55555 · Post by **jmv55555** » Wed Jan 23, 2013 7:38 pm

Re: pro-rating the bonus
Thanks for the clarification here. I was just plain wrong.

Re: PPT
I won't be able to meet this test because I go to the US too often on business trips or personal.

Re: bona fide resident
I was an intern in Canada in 2011 for only 3 months, moved to Canada full-time only in August 2012. So this won't work either. Any specific advice for me since I cannot claim the FEIC? (Thanks for all your help; this is my last question!)

nelsona · Post by **nelsona** » Wed Jan 23, 2013 8:57 pm

You said you moved in 2011. So, which is it? I love when stories change.

If you can't use FEIE (I don't know what FEIC is, you keep typing this) on your wages, then you use form 1116 foreign tax credit, just like on all your other Cdn income.

jmv55555 · Post by **jmv55555** » Thu Jan 24, 2013 10:41 am

Ok thanks. I said I moved to Canada in 2011 just to keep my post brief, since I had not intended originally to get into details about the FEIE residence tests (my bad for mistyping FEIC).