The IRS/CRA Income Tax Thread

[PEPSICHAN77B 0]

I moved to the states in june with my daughter, my husband is the usc. i started working in august and i worked the rest of the months in canada. I have 2 rsp accounts that i still pay for and i have my 2 bank account that i have with money from my 2008 tax year. how do i do my taxes since i was the person that always calimed my daughter as my dependent which she is my husband step daughter thur marrigedaince 2006, and she still recives her cbtc and disabilty for her she is 7 year old where do i start? als have my 17000 for school tuition left. if you can answer my ? that would be great.

thank you [/size]

[Wonder Amy 0]

Hi,

I've read through this thread but haven't found quite what i'm looking for. I lived in canada for part of the year and worked full time, then came to the US in the spring and received EI (and was married etc). I understand that i'll have to file leaving canada taxes once i receive my t4's - what is the best way to do this? ie: can i use quicktax or something similar, or do i search for the forms and print them out and mail them in?

Also - I've been paying OSAP back for their wonderful loans and I know I normally count the amount paid on interest against my taxes - how does that work in this case? for the leaving canada taxes, would i just count the interest paid until i left canada?

Afaik - for the IRS, we're filing jointly, and counting myself as a tax resident for the year - and using some of the forms to exclude my income from american taxes... so i think the remaining confusing is just on the canadian side with the CRA:)

Thanks for your help!

[childress_london 3]

I married my husband in August and of course he is still in Canada, has never been to the U.S. (and he is an Iranian citizen living in Canada.) I am trying to file Married Separately, but it seems I need a SSN for him, which of course he doesn't have. What do I do?

BTW he is a student and not currently working.

NV, I found out that I have to file as single, since he does not have a SSN.

You may not file as single.. period. Your best tax consideration would likely be to opt to have your husband treated as a tax resident for the entire tax year, file as married filing joint and exclude his income using Form 2555. Also do your taxes as married filing separate as well. You will have to file for an ITIN for your husband.

H&R Block told me to file single. Now I'm thoroughly confused. I already submitted my taxes.

They were wrong.... go back and get them to file an amendment free of charge. Their guarantee that they will get you the best refund, I guarantee you that they didn't do that.

Ohhhh, free of charge? I like that idea. Yeah, I'm doing an amendment, but didn't think of making them do that. After all, I paid $20 for that bogus advice!!

[a-jeanne 2]

Ok - here is my question. The tax guides are soooooo confusing. One says one thing and the next says another. Whew....

I am the US citizen and married a UK citizen in May 2008. He retired January 2008, came here on his K1 in March and receives a monthly portion of a Pension. He still doesn't have adjustment of status - is it beneficial to consider him as an alien or non alien resident? Where the heck do I put the pension income on the 1040 - it's only $3000?

What also has been messing up my 1040 is that in prior years, I as able to take the Earned Income Credit and Child Care Credit for my 2 daughters, but I am running into an issue with him not having income so it says I'm not eligible. HELP!

Your situation is somewhat more involved due to your wanting to claim the EIC and Child Care Credit and your husband not yet being a Us permanent resident. I want to look one thing up, but I won't be able to get the resource I want to look at until tomorrow night. I can give a clearer response then.

YOu can not get EIC if you are excluding your husband's foreign income using Form 2555. In addition, your spouse must also have a valid Social Security Number. If he entered the US on a K-1, he should have a SSN that qualifies. He definitely is considered a resident alien for tax purposes.

You income is combined, so I don't see how that would apply to you. Are you filing as MFJ. One is not eligible for EIC if you file as MFS. You would put the pension income under the pension line on the 1040 or under other income. Be sure to convert to US dollars. The exchange rate for 2008 is 1.8545. If tax is taken out, be sure to take a foriegn tax credit using form 1116.

Thank you for your help. We have filed MFJ and also have included his pension on "other income" on the 1040. And we have converted the pounds to $. So as long as we include his income, we can claim the EIC - correct? He does have a SS#.

[zyggy 9]

Ok - here is my question. The tax guides are soooooo confusing. One says one thing and the next says another. Whew....

I am the US citizen and married a UK citizen in May 2008. He retired January 2008, came here on his K1 in March and receives a monthly portion of a Pension. He still doesn't have adjustment of status - is it beneficial to consider him as an alien or non alien resident? Where the heck do I put the pension income on the 1040 - it's only $3000?

What also has been messing up my 1040 is that in prior years, I as able to take the Earned Income Credit and Child Care Credit for my 2 daughters, but I am running into an issue with him not having income so it says I'm not eligible. HELP!

Your situation is somewhat more involved due to your wanting to claim the EIC and Child Care Credit and your husband not yet being a Us permanent resident. I want to look one thing up, but I won't be able to get the resource I want to look at until tomorrow night. I can give a clearer response then.

YOu can not get EIC if you are excluding your husband's foreign income using Form 2555. In addition, your spouse must also have a valid Social Security Number. If he entered the US on a K-1, he should have a SSN that qualifies. He definitely is considered a resident alien for tax purposes.

You income is combined, so I don't see how that would apply to you. Are you filing as MFJ. One is not eligible for EIC if you file as MFS. You would put the pension income under the pension line on the 1040 or under other income. Be sure to convert to US dollars. The exchange rate for 2008 is 1.8545. If tax is taken out, be sure to take a foriegn tax credit using form 1116.

Thank you for your help. We have filed MFJ and also have included his pension on "other income" on the 1040. And we have converted the pounds to $. So as long as we include his income, we can claim the EIC - correct? He does have a SS#.

Yes.. as long as you don't exclude it, the foreign income in itself does not cause you to be ineligible for EIC.

[zyggy 9]

Hi,

I've read through this thread but haven't found quite what i'm looking for. I lived in canada for part of the year and worked full time, then came to the US in the spring and received EI (and was married etc). I understand that i'll have to file leaving canada taxes once i receive my t4's - what is the best way to do this? ie: can i use quicktax or something similar, or do i search for the forms and print them out and mail them in?

Also - I've been paying OSAP back for their wonderful loans and I know I normally count the amount paid on interest against my taxes - how does that work in this case? for the leaving canada taxes, would i just count the interest paid until i left canada?

Afaik - for the IRS, we're filing jointly, and counting myself as a tax resident for the year - and using some of the forms to exclude my income from american taxes... so i think the remaining confusing is just on the canadian side with the CRA:)

Thanks for your help!

You can use Quicktax to do the return, but you won't be able to electronically file it. You need to send it to the International Tax Services Office. You will be able to prorate the interest payments against your return. The proration is # days in Canada/366.

EI and any other Canadian Income that had the non-resident tax taken on it is not included on the Leaving Canada return unless you elect to file under Section 217.

[zyggy 9]

Hi Ziggy

I have a couple points I would like you to clear for us before we have our taxes done this yr.

I've been here in the U.S since 07 and collect a monthly pension which is deposited in my bank in Canada.

Last yr. my first tax filing here Jackson Hewitt did our taxes and when I pointed out about my pension earnings in Canada they said it didn't have to be reported here in the U.S. as pension payments would be tax exempt and Canada already taxed it.

My question is. Was this correct, I'd like to know for sure I don't want the IRS chasing after me saying we failed to report foriegn income.

My 2nd question: Do I just file a normal Canadian tax return this yr or do I have to notify them again for a section 217 return. Last yr. I filed under section 217.

Also this yr I have income earnings here in the U.S do they go on my Canadian return with my pension earnings

Thanks

Allie

THe gentlemen at JH was most incorrect. Pension payments are definitely NOT tax exempt with the exception of SS payments. If your pension payment is CPP, then it may be. I need more information.

If you had the 25% non resident tax taken out, then you are not required to file with CRA. If you believe your worldwide income will place you in a tax bracket below 25%, by all means file the Section 217 and get a portion of that 25% back.

The pension is a company retirement pension. When I moved here I called Mellon ( the pension administrator) to inform them I was now living in the U.S. and inquired whether they would be taking the 25% non-residence tax and they said they would be taking a rate of 15%.

Does this now mean I no longer file a Canadian Tax return ? Also how do I now go about reporting to the IRS the pension payments from Canada that weren't put in last yrs. U.S. return?

Thanks for yourassistance Ziggy

Allie

The 15% may be due to Tax treaty and it's treatment of pension funds. But yes, you would no longer file a Canadian tax return.

You would convert the amount of your pension into US Dollars and report it on the pension line on the 1040. (Line 16) If it is a pension from employment (defined benefit plan), 100% is taxable. You would take a foreign tax credit on the pension amount.

Edited February 5, 2009 by zyggy

[Allie 5]

Hi Ziggy

I have a couple points I would like you to clear for us before we have our taxes done this yr.

I've been here in the U.S since 07 and collect a monthly pension which is deposited in my bank in Canada.

Last yr. my first tax filing here Jackson Hewitt did our taxes and when I pointed out about my pension earnings in Canada they said it didn't have to be reported here in the U.S. as pension payments would be tax exempt and Canada already taxed it.

My question is. Was this correct, I'd like to know for sure I don't want the IRS chasing after me saying we failed to report foriegn income.

My 2nd question: Do I just file a normal Canadian tax return this yr or do I have to notify them again for a section 217 return. Last yr. I filed under section 217.

Also this yr I have income earnings here in the U.S do they go on my Canadian return with my pension earnings

Thanks

Allie

THe gentlemen at JH was most incorrect. Pension payments are definitely NOT tax exempt with the exception of SS payments. If your pension payment is CPP, then it may be. I need more information.

If you had the 25% non resident tax taken out, then you are not required to file with CRA. If you believe your worldwide income will place you in a tax bracket below 25%, by all means file the Section 217 and get a portion of that 25% back.

The pension is a company retirement pension. When I moved here I called Mellon ( the pension administrator) to inform them I was now living in the U.S. and inquired whether they would be taking the 25% non-residence tax and they said they would be taking a rate of 15%.

Does this now mean I no longer file a Canadian Tax return ? Also how do I now go about reporting to the IRS the pension payments from Canada that weren't put in last yrs. U.S. return?

Thanks for yourassistance Ziggy

Allie

The 15% may be due to Tax treaty and it's treatment of pension funds. But yes, you would no longer file a Canadian tax return.

You would convert the amount of your pension into US Dollars and report it on the pension line on the 1040. (Line 16) If it is a pension from employment (defined benefit plan), 100% is taxable. You would take a foreign tax credit on the pension amount.

I would really like to thank you Ziggy for assisting all of us here in the Canadian Forum with our tax issues. You make it a lot easier to deal with

Allie

[Wonder Amy 0]

Hi,

I've read through this thread but haven't found quite what i'm looking for. I lived in canada for part of the year and worked full time, then came to the US in the spring and received EI (and was married etc). I understand that i'll have to file leaving canada taxes once i receive my t4's - what is the best way to do this? ie: can i use quicktax or something similar, or do i search for the forms and print them out and mail them in?

Also - I've been paying OSAP back for their wonderful loans and I know I normally count the amount paid on interest against my taxes - how does that work in this case? for the leaving canada taxes, would i just count the interest paid until i left canada?

Afaik - for the IRS, we're filing jointly, and counting myself as a tax resident for the year - and using some of the forms to exclude my income from american taxes... so i think the remaining confusing is just on the canadian side with the CRA:)

Thanks for your help!

You can use Quicktax to do the return, but you won't be able to electronically file it. You need to send it to the International Tax Services Office. You will be able to prorate the interest payments against your return. The proration is # days in Canada/366.

EI and any other Canadian Income that had the non-resident tax taken on it is not included on the Leaving Canada return unless you elect to file under Section 217.

Thank you for your reply!

Loading up quicktax just added more questions For my return to canada, do I list myself as married since i was married after having left - and if so - should i file jointly or separately (since he owes nothing to canada)?

Its also asking for his SIN and world income etc (if i file as married, filing separately) - can I simply put NA for the SIN and enter his world income, or?

Also - i'm not seeing an area to enter the date I left on quicktax (but one exists on my paper form) - any ideas?

Thanks for all your help!

[Wonder Amy 0]

--I cant seem to edit my above post.

When i am using quicktax - it asks for my address as of december 31st - so i enter non resident and it gives me the non resident tax forms - if i enter ontario, i receive the form i have in paper with the area for if i have ceased to be a resident - but it retains that I was in ontario on dec. 31st (which i clearly wasnt) and then only allows me to enter canadian addresses.

So... which forms should I be using?

Please let me know when you can!

Thanks

[zyggy 9]

--I cant seem to edit my above post.

When i am using quicktax - it asks for my address as of december 31st - so i enter non resident and it gives me the non resident tax forms - if i enter ontario, i receive the form i have in paper with the area for if i have ceased to be a resident - but it retains that I was in ontario on dec. 31st (which i clearly wasnt) and then only allows me to enter canadian addresses.

So... which forms should I be using?

Please let me know when you can!

Thanks

I guess Quicktax really breaks down in this instance. You may have to use another program or do what I did and do it by hand. You may want to call their tech support and see if there's a patch or something. YOu definitely want to be using the Ontario form and not the Non-resident one. Remember that you have to pay the full OHIP premium. You don't get to prorate that... wonderful that way aren't they.

Edited February 5, 2009 by zyggy

[trailmix 77]

--I cant seem to edit my above post.

When i am using quicktax - it asks for my address as of december 31st - so i enter non resident and it gives me the non resident tax forms - if i enter ontario, i receive the form i have in paper with the area for if i have ceased to be a resident - but it retains that I was in ontario on dec. 31st (which i clearly wasnt) and then only allows me to enter canadian addresses.

So... which forms should I be using?

Please let me know when you can!

Thanks

I guess Quicktax really breaks down in this instance. You may have to use another program or do what I did and do it by hand. You may want to call their tech support and see if there's a patch or something. YOu definitely want to be using the Ontario form and not the Non-resident one. Remember that you have to pay the full OHIP premium. You don't get to prorate that... wonderful that way aren't they.

I can tell from that line that you are a tax guy - and that you have probably used Cantax at some point

[zyggy 9]

Just a note... I do not respond to PM's regarding tax issues. If you have a tax question, please post it on the thread.

[sly_wolf 199]

Got my taxes finished and e-filed yesterday and I forgot to add Form 8891 for my RRSP's ..... dammit. I will send it separately by mail. Hope that will be all ok?

Thanks for all your help Zyggy.

Sly

[pegbert64 0]

I'm trying to get up to date with all the Canadian taxes. I called CRA to find out what they needed, and they said that I must file a return for 2006, even if I had no income. 2007 will become my "exit" return, as that is the year that I filed for US Permanent Residency.

My question is this: on the 2006 T-1 Identification box, do I use my CURRENT (married) name and current US address, or do I use my PREVIOUS name and former Canadian address?

Thank you.