The IRS/CRA Income Tax Thread

[Frenchy 0]

In 2007 I filed as a deemed non-resident (after filing the NR73), I don't think I paid non-resident taxes.

1. How can I make my "final" tax declaration in Canada? I've searched for "departure tax" return on the CRA site but found nothing.

2. I was told to file the T1161 but my total property value was below $25,000 so I don't think I should have to file this, or do I?

3. Also, should I immediately close all Canadian bank accounts such as mutual funds and checking (other than my RRSP)?

4. Can I do a direct transfer from my Canadian account to my US account?

Thanks! I am really confused...

Since you're a deemed resident of Canada, I don't believe you left Canada yet until the date you sold your property. I suggest you call the International Tax Services office to confirm this. They are very helpful with these sort of issues. Based on the assumption, I submit the following:

1) You're going to need to file a new NR-73 showing that you no longer hold property in Canada to be reclassified as a non-resident of Canada. I would also file a leaving Canada return with the date you sold your house as the date that you "left" Canada. The capital gain on your house would be included in the Leaving Canada return.

2) This form is filed for any of the property listed that you own as of the date that you "left" Canada. If you have any securities etc as listed on the form, you must pay capital gains based on the values of those securities on the date you left Canada.

3) That's up to you. Others have kept those accounts open with no adverse effects. However, since you're a deemed resident and need to apply to get that designation removed, this may be harder for you. Just make sure you notify those institutions of your non-residency.

Your example is one of the reasons why I recommend people to NOT send a NR-73 to CRA unless they ask you to.

4) You sure can. There should be no issues. IF the amoutn is larger than $10,000, your bank will report it to the Treasury Department for money laundering monitoring. YOur money is your money and it will not be taxed if you transfer it.

Thanks for your reply!

1) They have declared me as a deemed non-resident. The only property I own or owned was RRSPs and bank accounts, I've never owned a house. Do you think I should re-file the NR-73?

[S & J 0]

Thanks for your reply!

1) They have declared me as a deemed non-resident. The only property I own or owned was RRSPs and bank accounts, I've never owned a house. Do you think I should re-file the NR-73?

Don't refile, they got it right.

Your departure return would have been your return for 2007 with the date of departure written in.

I filled out an NR-73 also with no problems, but then mine was simple like yours, all I had was RRSPs and bank accounts. I am keeping my bank accounts open for when I visit. Especially now with the exchange rate, I am hoping it will improve.

[bootslacky 1]

Thanks ziggy. I will do so.

[zyggy 9]

Thanks for your reply!

1) They have declared me as a deemed non-resident. The only property I own or owned was RRSPs and bank accounts, I've never owned a house. Do you think I should re-file the NR-73?

Don't refile, they got it right.

Your departure return would have been your return for 2007 with the date of departure written in.

I filled out an NR-73 also with no problems, but then mine was simple like yours, all I had was RRSPs and bank accounts. I am keeping my bank accounts open for when I visit. Especially now with the exchange rate, I am hoping it will improve.

Ummm no.. don't file anything.

You can keep your stuff there no problem. Make sure you tell your custodians there about your non-resident status. If you have withdrawls, they will take care of the non-resident tax. You do no need to file anything with CRA again.

[Frenchy 0]

Thanks for your reply!

1) They have declared me as a deemed non-resident. The only property I own or owned was RRSPs and bank accounts, I've never owned a house. Do you think I should re-file the NR-73?

Don't refile, they got it right.

Your departure return would have been your return for 2007 with the date of departure written in.

I filled out an NR-73 also with no problems, but then mine was simple like yours, all I had was RRSPs and bank accounts. I am keeping my bank accounts open for when I visit. Especially now with the exchange rate, I am hoping it will improve.

Ummm no.. don't file anything.

You can keep your stuff there no problem. Make sure you tell your custodians there about your non-resident status. If you have withdrawls, they will take care of the non-resident tax. You do no need to file anything with CRA again.

Ziggy: where have you been all my life? LOL You know I've warned both my banks (RRSP and Mutual Funds) I'd left the country and had NO reaction from them. When you say I do not need to file anything with CRA again, does that mean for income tax also? They sent me a packet and an accountant talked about final tax or departure tax? Thanks for being there for all of us!

[zyggy 9]

Thanks for your reply!

1) They have declared me as a deemed non-resident. The only property I own or owned was RRSPs and bank accounts, I've never owned a house. Do you think I should re-file the NR-73?

Don't refile, they got it right.

Your departure return would have been your return for 2007 with the date of departure written in.

I filled out an NR-73 also with no problems, but then mine was simple like yours, all I had was RRSPs and bank accounts. I am keeping my bank accounts open for when I visit. Especially now with the exchange rate, I am hoping it will improve.

Ummm no.. don't file anything.

You can keep your stuff there no problem. Make sure you tell your custodians there about your non-resident status. If you have withdrawls, they will take care of the non-resident tax. You do no need to file anything with CRA again.

Ziggy: where have you been all my life? LOL You know I've warned both my banks (RRSP and Mutual Funds) I'd left the country and had NO reaction from them. When you say I do not need to file anything with CRA again, does that mean for income tax also? They sent me a packet and an accountant talked about final tax or departure tax? Thanks for being there for all of us!

If you filed a leaving Canada return with the International Tax Services Office when you left Canada in 2007, you need to file nothing more. Nothing for income tax or RRSP. THey will take the 25% non-resident tax and you need to file nothing as long as they do that.

[AyaJulia 0]

Hi...

I'm a US Citizen. Last year since my husband lived with me in the US, I filed jointly, got him a Taxpayer ID number, the whole shebang... part of getting him that number means of course all of his income has to get reported, something I'm not willing to skimp on since we want to live in the US again some time....

We've moved to Canada, so stupid me waiting until the last minute... I'm sitting here surrounded by all of his T4s staring at a form 1116 crying 'cuz I'm so frustrated. I thought with all the relationship between our two countries, someone would have easy instructions posted somewhere... Add line 16, 18, and 22 from your T4, put it into line 2 on your 1116.... >.< I can't find anything like that though, so I'll just ask this.

My husband has CPP deductions, EI deductions, and of course Income Tax deductions listed on his T4s. Which of these do I put in to the 1116 as "expenses definitely related to the foreign income?" Can I use it all? Is any of it not "expenses definitely related to the foreign income?" I can't find this information online and we can't afford a tax service, meanwhile here I am stuck on line 2.

We're just a young couple with no property tax, no interest income, nothing but about $18k USD worth of income, 100% of it earned in Canada. No kids. Our situation is about as basic as it gets. Thank you for any help you can offer.

Edit: Augh, now I see line 2 isn't related to deductions at all. I'm so lost. My question still stands, I just need to keep digging to find out where to put it.

Edited April 15, 2009 by AyaJulia

[JillA 2]

Hi...

I'm a US Citizen. Last year since my husband lived with me in the US, I filed jointly, got him a Taxpayer ID number, the whole shebang... part of getting him that number means of course all of his income has to get reported, something I'm not willing to skimp on since we want to live in the US again some time....

We've moved to Canada, so stupid me waiting until the last minute... I'm sitting here surrounded by all of his T4s staring at a form 1116 crying 'cuz I'm so frustrated. I thought with all the relationship between our two countries, someone would have easy instructions posted somewhere... Add line 16, 18, and 22 from your T4, put it into line 2 on your 1116.... >.< I can't find anything like that though, so I'll just ask this.

My husband has CPP deductions, EI deductions, and of course Income Tax deductions listed on his T4s. Which of these do I put in to the 1116 as "expenses definitely related to the foreign income?" Can I use it all? Is any of it not "expenses definitely related to the foreign income?" I can't find this information online and we can't afford a tax service, meanwhile here I am stuck on line 2.

We're just a young couple with no property tax, no interest income, nothing but about $18k USD worth of income, 100% of it earned in Canada. No kids. Our situation is about as basic as it gets. Thank you for any help you can offer.

Edit: Augh, now I see line 2 isn't related to deductions at all. I'm so lost. My question still stands, I just need to keep digging to find out where to put it.

Sorry, I don't know the answer but have you tried turbotax.... they have a free edition, I used that and it was really easy.... it fills out everything for you and knows where to put it, you just input the numbers....

[zyggy 9]

Hi...

I'm a US Citizen. Last year since my husband lived with me in the US, I filed jointly, got him a Taxpayer ID number, the whole shebang... part of getting him that number means of course all of his income has to get reported, something I'm not willing to skimp on since we want to live in the US again some time....

We've moved to Canada, so stupid me waiting until the last minute... I'm sitting here surrounded by all of his T4s staring at a form 1116 crying 'cuz I'm so frustrated. I thought with all the relationship between our two countries, someone would have easy instructions posted somewhere... Add line 16, 18, and 22 from your T4, put it into line 2 on your 1116.... >.< I can't find anything like that though, so I'll just ask this.

My husband has CPP deductions, EI deductions, and of course Income Tax deductions listed on his T4s. Which of these do I put in to the 1116 as "expenses definitely related to the foreign income?" Can I use it all? Is any of it not "expenses definitely related to the foreign income?" I can't find this information online and we can't afford a tax service, meanwhile here I am stuck on line 2.

We're just a young couple with no property tax, no interest income, nothing but about $18k USD worth of income, 100% of it earned in Canada. No kids. Our situation is about as basic as it gets. Thank you for any help you can offer.

Edit: Augh, now I see line 2 isn't related to deductions at all. I'm so lost. My question still stands, I just need to keep digging to find out where to put it.

THe 1116 is not the proper form for you. THe proper form is the 2555.

Zyg

[daisylynn 0]

We finally took our taxes in to be professionally done. The lady seemed to know what she was talking about. She knew we needed the 2555 and 1116 by just talking to me (others that I talked to didn't even know which forms I needed.) She finishes is all and we are getting back a lot more than expected. Sounded good to me!

Then I got home and was looking through the papers and it doesn't look like she converted the Canadian income to US dollars. I asked here when we were there if she had done that and she said it (?) did it automatically. The wages he earned were still in Canadian currency but I figured since we had the exclusion it wouldn't really matter too much either way, right? I mean they kinda cancel out? But what about the RRSP that he took out? Mind you, it wasn't a lot at all but it wasn't converted to US dollars either. Will this matter or do I need to do something about it?

Thanks!!!

[sbgagne 0]

Hello all, I am hoping someone can help me out. My wife (Canadian Citizen) moved to the US 12/31/07 and has resided here continually. When using Quicktax to do her taxes if she selects Non-resident it does not allow her to enter her Releve 2 info from Quebec and asks about spousal worldwide income. If she does select that she is a resident of Quebec it allows her to enter the information. Is there someplace else the Releve 2 information can be added?

[bluegreen 0]

Does anyone know about HBP? I withdrew funds for the HBP in 2007. I have not repaid any yet, since you have two years to start doing that. However, I understand now that I need to claim that money as income, since I no longer qualify for that program. The CRA site says I have to claim it on the return of the year in which I withdrew it, but other reading suggests that I claim it on my departure return (which will be 2008). Which is it?? So far I have entered it on line 129 of my departure return, even through the T4rsp is from 2007. It is nice becasue it is pretty much the only income I am claiming for the entire year. If I had to go back and add it to 2007 it would have way bigger implications, I think. I am so not au fait with this stuff.

However, I am still confused about whether I was a deemed resident for 2008 (I think so. I still have a house, po box, bank accounts, cell phone.....and I spent a good chunk of the year in Canada). If I am a deemed resident am I allowed to cash out of the HBP plan? I, of course, cannot get through on the International Tax 1-800 number, since I am a major procrastinator and it is constantly busy starting at 6 am.

ALSO, does anyone know if I can use Quicktax for my departure return? The departure return is just a general T1 return with a departure date included, right? I am confused because although Quicktax has kind of figured out that I am now a non-resident (It asks for worldwide income, etc) it does not explicitly ask for the departure date like it does right on the first page of the T1 form.

[Texanadian 10]

Small note to add. April 27/2009......Received cheque for 2007 tax appeal. Finally.

[one_day_at_a_time 0]

You should have claimed the HBP/RSP withdrawal as income on your 2007 tax return - I would suggest that you will have to send in an amended 2007 return.

Does anyone know about HBP? I withdrew funds for the HBP in 2007. I have not repaid any yet, since you have two years to start doing that. However, I understand now that I need to claim that money as income, since I no longer qualify for that program. The CRA site says I have to claim it on the return of the year in which I withdrew it, but other reading suggests that I claim it on my departure return (which will be 2008). Which is it?? So far I have entered it on line 129 of my departure return, even through the T4rsp is from 2007. It is nice becasue it is pretty much the only income I am claiming for the entire year. If I had to go back and add it to 2007 it would have way bigger implications, I think. I am so not au fait with this stuff.

However, I am still confused about whether I was a deemed resident for 2008 (I think so. I still have a house, po box, bank accounts, cell phone.....and I spent a good chunk of the year in Canada). If I am a deemed resident am I allowed to cash out of the HBP plan? I, of course, cannot get through on the International Tax 1-800 number, since I am a major procrastinator and it is constantly busy starting at 6 am.

ALSO, does anyone know if I can use Quicktax for my departure return? The departure return is just a general T1 return with a departure date included, right? I am confused because although Quicktax has kind of figured out that I am now a non-resident (It asks for worldwide income, etc) it does not explicitly ask for the departure date like it does right on the first page of the T1 form.

[bluegreen 0]

You should have claimed the HBP/RSP withdrawal as income on your 2007 tax return - I would suggest that you will have to send in an amended 2007 return.

Does anyone know about HBP? I withdrew funds for the HBP in 2007. I have not repaid any yet, since you have two years to start doing that. However, I understand now that I need to claim that money as income, since I no longer qualify for that program. The CRA site says I have to claim it on the return of the year in which I withdrew it, but other reading suggests that I claim it on my departure return (which will be 2008). Which is it?? So far I have entered it on line 129 of my departure return, even through the T4rsp is from 2007. It is nice becasue it is pretty much the only income I am claiming for the entire year. If I had to go back and add it to 2007 it would have way bigger implications, I think. I am so not au fait with this stuff.

However, I am still confused about whether I was a deemed resident for 2008 (I think so. I still have a house, po box, bank accounts, cell phone.....and I spent a good chunk of the year in Canada). If I am a deemed resident am I allowed to cash out of the HBP plan? I, of course, cannot get through on the International Tax 1-800 number, since I am a major procrastinator and it is constantly busy starting at 6 am.

ALSO, does anyone know if I can use Quicktax for my departure return? The departure return is just a general T1 return with a departure date included, right? I am confused because although Quicktax has kind of figured out that I am now a non-resident (It asks for worldwide income, etc) it does not explicitly ask for the departure date like it does right on the first page of the T1 form.

Hmmm. I don't think I should have done that because at the time I was a resident and still participating in the program. I added it the return as an HBP withdrawal, but obviously I was not taxed on it since I was participating in HPB. Now I need them to know that I am no longer participating. SO maybe NOW it is appropriate to file an ammended return?

I have not filed my taxes yet because I still haven't been able to contact that international tax office—it is busy non stop! Hopefully today I will find a human to talk to.