13.1 Aliens and U.S. Citizens Living Abroad: Canadian & U.S. Tax Issues
I am a U.S. citizen. If I move to Canada to live and work there
as a Canadian permanent resident, do I pay both U.S. and Canadian Taxes?
United States citizens living abroad are required to file annual U.S.
income tax returns and report their worldwide income if they meet the minimum
income filing requirements for their filing status and age. You must contact
the Canadian Government to determine whether you must file a Canadian tax
return and pay Canadian taxes. For the United States income tax return, you
will have several options available to you regarding claiming a foreign tax
credit or excluding some or all of your foreign earned income.
References:
I am a Canadian citizen living and working in the U.S. for a U.S.
employer on a visa. Do I need to file both a U.S. tax return and a Canadian
tax return?
You must comply with both U.S. and Canadian filing requirements. In the
United States, you generally are required to file a return if you have income
from the performance of personal services within the United States. However,
under certain circumstances, that income may be exempt from payment of U.S.
tax pursuant to the U.S.-Canada income tax treaty. You need to determine what
type of visa you have, and how that impacts your residency status in the United
States. If, based on the tax code and your visa status you are treated as
a U.S. resident, then your entitlement to treaty benefits will be impacted.
References:
13.3 Aliens and U.S. Citizens Living Abroad: Foreign Income & Foreign Income Exclusion
Do I have to meet the 330-day presence test or have a valid working
resident visa to meet the requirement for foreign income exclusion?
To claim the foreign earned income exclusion, the foreign housing exclusion,
or the foreign housing deduction, you must have foreign earned income, your
tax home must be in a foreign country, and you must be one of the following:
A U.S. citizen who is a bona fide resident of a foreign country or countries
for an uninterrupted period that includes an entire tax year,
A U.S. resident alien who is a citizen or national of a country with which
the United States has an income tax treaty with a nondiscrimination article
in effect and who is a bona fide resident of a foreign country or countries
for an uninterrupted period that includes an entire tax year, or
A U.S. citizen or a U.S. resident alien who is physically present in
a foreign country or countries for at least 330 full days during any period
of 12 consecutive months.
U.S. tax law does not specifically require a foreign resident visa or work
visa for this purpose, but you (must/should) comply with the other country's
laws.
References:
13.4 Aliens and U.S. Citizens Living Abroad: Nonresident Alien - General
I have an H-1 visa and my husband has an F-1 visa. We both lived
in the United States all last year and had income. What kind of form should
we file? Do we file our taxes separately or jointly?
You will have met the substantial presence test and will be taxed as a
resident alien for last year, while your husband is likely to be a nonresident
alien. Refer to Tax Topic 851 for an explanation of the relevant tax
forms. You may file a joint tax return if your husband makes the choice to
be treated as a resident for the entire year. Generally, however, you cannot
claim tax treaty benefits as a resident alien. Please refer to Publication 519, U.S.
Tax Guide for Aliens , for detailed instructions on making this choice.
References:
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