Some tax questions...

[naviomelo 0]

Hey everyone, I have a few tax questions...I hope someone can help because I'm lost. I've tried reading the info in other threads but I can't seem to find the answers that relate to my specific scenario

I moved from Canada to the US on a K-1 in October 2008. We got married in October 2008. I have Canadian employment income from January-October of 2008, then EI payments that I received in 2008 after I was in the United States. I don't have a green card yet; but I did get the Welcome to the United States letter a few days ago.

Anyway, here's the questions that I have...

- Am I a non-resident, a deemed non-resident, or what?

- Where is the link to find the proper Canadian T1 form that I have to fill out?

- Do I add my employment income to the EI income and submit all that, or does the EI income not need to be reported because the non-resident tax has already been deducted?

- After I send this tax return to Canada CRA, do I ever have to correspond with them again?

- What forms do I need for my US return? My US spouse didn't work in 2008 and all we have for income is interest income, capital gains (stock market), and the 2008 EI I received from Canada after I moved here.

Thank you so much for the help!

[Texanadian 10]

Canada:

Fill out the same T1 form you always have filled out in the past. I'm not sure off the top of my head if you're a resident or a deemed resident. Do not file as a non-resident or else it'll complicate things.

If your combined Federal and provincial tax brackets are less than 25%, then fill out a Section 217 with your return. That way your EI income will be included with your regular Canada income at normal Federal and provincial tax rates. You will be able to get a refund on the 25% you've paid on non-resident tax on the EI money.

If your Federal and provincial tax brackets are higher than 25%, then fill out the T1 form but don't include the EI income anywhere on your return. Normally the 25% non-resident tax is all you would pay for EI. No Canadian income taxes would need to filed for it as the 25% takes care of everything. The non-resident 25% tax is a one time/taken off the top/you don't need to do anything unless you want to thing.

Regardless of which one you do, write a note with your return saying you're asking for the full basic personal exemptions for the full year. After this year you won't have to do anything with Canada Revenue anymore. The exception is if you're filing a Section 217 next year to get some of 2009's EI tax money back (the 25% non resident they're charging for 2009)

USA:

Fill out a 2555-EZ to include your EI money as excluded income. Schedule D is used for capital gains/losses. Interest incomes goes on the 1040 form.

You have the choice of being a non-resident alien or a resident alien in the US. Non-resident would tax you on US only income from the day you arrived. Resident would tax you on your worldwide income from Jan 1st-Dec 31st.

File Married-Joint.

[naviomelo 0]

Thank you so much, Texanadian.