Living in US, working in Canada

[CDAgirlMI 51]

HI,

I know the topic of living in the US & working in Canada has come up, but I didn't see anything regarding 2 things that came to my mind:

1. How would you file taxes? Working in Canada, I'm sure that the Canadian government would want some of that income...and I would think that the US government would want some of that income as well since you live in the States...is that right????

2. Currency. So if you work in Canada, you'd be paid in Canadian dollars....do you get your cheque, change it to US dollars & take it home? Deposit it in Canada? Is it worth it considering the Canadian dollar is worth less(right now anyways)?

I know the best thing would be to find a job in the US if you live there, but for some people the opportunity to have a well paying job in Canada that's near the border might make working in Canada worth it(or not?)

Anyone know the answers or is doing this right now??

Thanks!!!

[metals95 1]

Living in SE Michigan with the current economy, this though has come up for me too. I am glad that I can work in either country. When I started working in Michigan (many years ago) I lived in Windsor Ontario. For that case I paid taxes out of my pay check to MI and the IRS, plus filed taxes with CCRA and wrote them a check each year for the difference minus the foreign tax credit.

Likewise if you were living in MI and working in Ontario you would pay taxes out of your paycheck in Canada and then file taxes in MI and with the IRS. If you did not owe more than you had already paid in Canada you would not have to pay more taxes. There are tons of accountants in Windsor that do these cross border tax returns.

If you had a green card and worked in Canada while living in Michigan, you want to make sure that you file taxes as a US resident if you ever want to naturalize.

RRSP issues can be a problem too. You may not want to contribute to your RRSP and therefore lose that tax shelter plus by worknig in Canada you cannot take advantage of 401k.

So to sum up, unless it is a great job, or pays tons, with the loss of 401k and currency exchange losses, I don't think that you will find that it "pays" to work in Canada in live in MI. But still better than unemployed.

Plus RBC and TD have ability to transfer money between Canadian and US divisions of their banks.

[Krikit 1,165]

If you receive an income from Canada you submit a tax return like you would normally. You will be taxed at the non-resident rate of 25% so make sure you tell your employer that you are a non-resident or you will be paying tons of back taxes. You also need to claim that income on your US tax return but it is tax exempt up to 80k. I have earned income deposited directly into my Canadian bank. On some contracts I have them pay me directly in USD. I also receive a widow's pension which was being directly deposited into my Canadian account until last Fall when CPP royally screwed up. The end result of that fiasco is that they now send me a cheque in USD which I, in turn, send right back to Canada for deposit. Which really works in my favour right now with the current exchange rate.