Personal Finance

Living in the United States and Canada

  • Last Updated:
  • Nov 7th, 2020 1:50 pm
[OP]
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Oct 11, 2012
213 posts
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Living in the United States and Canada

I’ve been entertaining the thought of living in the United States for 6 months and then living back in Canada the other 6. Is it possible to do this (for CRA tax implications) without a permanent Canadian address?
30 replies
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May 12, 2014
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My understanding is that if you do this you'll almost certainly have to file taxes in both countries.

Sounds very expensive.
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Jul 12, 2008
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There are a lot of things to consider such as health care, citizenship and so on. The IRS is more likely to be an issue than CRA in general though.
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Nov 23, 2004
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FrancisBacon wrote: My understanding is that if you do this you'll almost certainly have to file taxes in both countries.

Sounds very expensive.
In which way? It may means having to file a return in each country but there shouldn't be double taxation. Also 6 months minus a day should keep you in the clear within a calendar year should keep one in the clear?
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There's a tax treaty so in most cases you won't be double taxed. You'll need one primary tax residency though...and if that's the US then say goodbye to your TFSA.

That aside, without a permanent address in Canada, were you planning on just staying at Airbnb's? In that case you'd be in Canada as a citizen but "just visiting".

Both countries allow dual citizenship so no issues there.
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Feb 9, 2009
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Many snowbirds do this.

Just have to prove to customs that you intend to maintain Canada as your primary residence (real estate, investments/bank accounts, your car registration, kids, etc).
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May 12, 2014
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Montreal
wilbrod wrote: In which way? It may means having to file a return in each country but there shouldn't be double taxation. Also 6 months minus a day should keep you in the clear within a calendar year should keep one in the clear?
6 months minus a day will not keep you clear in either jurisdiction. First, cutting it so close means it's almost guaranteed that you'll go over one day (simple mistake, minor health issue, ..)

Second, both countries are likely to consider that such long stays mean that you're a resident unless you are extremely careful in how you set yourself up.


There is indeed a tax treaty, but it doesn't cover everything (eg, RESPs). Also, the tax treatment is different for some things (eg primary residence).


Really, it depends so much on how complex your life and finances are: what's the source of your income? How are your savings structured? What will your lifestyle be? (Eg where will your family live? )


What will you do about healthcare?
[OP]
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Oct 11, 2012
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I appreciate all the insight. Obviously there’s more implications to this than I initially thought and your advice has given me cause for pause.

Thank you!
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Jan 9, 2011
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wilbrod wrote: In which way? It may means having to file a return in each country but there shouldn't be double taxation. Also 6 months minus a day should keep you in the clear within a calendar year should keep one in the clear?
Six months minus a day is what the INS uses to determine how long you can stay in the country without a visa or work permit. The INS does not care about your taxes. The IRS calculates it differently, it has a formula that considers how much time you have spent in the USA over the previous three years; if you want to spend maximum time in the USA every year without having to pay taxes it works out to max four months per calendar year. The IRS does not care about your immigration status, it just wants your money. Many would-be snowbirds don't realize this and learn the hard way.
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Oct 7, 2007
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I have been hearing some people consider the possibility of moving to the U.S. if Canada goes ahead with its current plans that tie in with the new agenda. These people are concerned about loss of private property rights and other individual freedoms and the implementation of some social programs that will take us in a direction that will change the social and financial landscape of our country. I keep looking for signs that these people are mistaken but lately when I hear our leaders speak, I think that there might actually be something to this. Leaving the country would be a bold move for someone who loves being a Canadian but if our country's values are going to change in a big way, I guess people may decide to re-evaluate their priorities.
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choclover wrote: I have been hearing some people consider the possibility of moving to the U.S. if Canada goes ahead with its current plans that tie in with the new agenda. These people are concerned about loss of private property rights and other individual freedoms and the implementation of some social programs that will take us in a direction that will change the social and financial landscape of our country. I keep looking for signs that these people are mistaken but lately when I hear our leaders speak, I think that there might actually be something to this. Leaving the country would be a bold move for someone who loves being a Canadian but if our country's values are going to change in a big way, I guess people may decide to re-evaluate their priorities.
Leaving for the US?? What values do they have that trump those that we have in Canada? ....Beware of "greener pastures".
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Nov 23, 2004
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Kiraly wrote: Six months minus a day is what the INS uses to determine how long you can stay in the country without a visa or work permit. The INS does not care about your taxes. The IRS calculates it differently, it has a formula that considers how much time you have spent in the USA over the previous three years; if you want to spend maximum time in the USA every year without having to pay taxes it works out to max four months per calendar year. The IRS does not care about your immigration status, it just wants your money. Many would-be snowbirds don't realize this and learn the hard way.
Thanks for your input. I know the IRS but what is INS? We spend months every year (except this year because of Covid crisis) so I'm definitely going to be researching this 4 months thing you're claiming. I'm not even in my 40s yet and there will be quite a few trips down there in the future.
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wilbrod wrote: Thanks for your input. I know the IRS but what is INS? We spend months every year (except this year because of Covid crisis) so I'm definitely going to be researching this 4 months thing you're claiming. I'm not even in my 40s yet and there will be quite a few trips down there in the future.
INS = immigration and naturalization service. Basically the people who decide to let you into the country. It’s an entirely different part of US Gov than the IRS, and neither enforces each other’s priorities or even cares about them.
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WetCoastGuy wrote: Leaving for the US?? What values do they have that trump those that we have in Canada? ....Beware of "greener pastures".
It is not so much about where we are right now but it is about how things are going to change for us. It sounds like we may no longer be able to count on many of the freedoms and rights that we currently have. At first I didn't believe what people were telling me but as I observe the subtleties around me, I think there may actually be truth to what I am hearing.
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choclover wrote: It is not so much about where we are right now but it is about how things are going to change for us. It sounds like we may no longer be able to count on many of the freedoms and rights that we currently have. At first I didn't believe what people were telling me but as I observe the subtleties around me, I think there may actually be truth to what I am hearing.
If you want to say something, why not say something instead of dancing around the issue? Exactly what are you so terrified of that you are considering leaving the country? The only specific thing you mentioned is "private property rights" which do not exist in Canada.
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Kiraly wrote: INS = immigration and naturalization service. Basically the people who decide to let you into the country. It’s an entirely different part of US Gov than the IRS, and neither enforces each other’s priorities or even cares about them.
Looks like I'm 17 years behind the times...that department was abolished in 2003 and replaced by Immigration and Customs Enforcement (ICE). Sorry for the confusion. My point still stands though...ICE uses six months minus a day per year for how long Canadians may remain in the USA without getting a visa, and the IRS's formula works out to max four months per year before they consider you a US resident for the purpose of tax obligations.

The IRS's formula is:

Days spent in the USA this year
+
Days spent in the USA the previous year divided by 3
+
Days spent in the USA the year before that divided by 6

If the total is below 183, you are not considered a US resident for taxation purposes. If the total is 183 or higher, you are. Works out to a maximum of 122 days/year if you do it every year, or you can stretch it up to 182 days if you stay out of the USA for the two years prior. https://www.pwc.com/ca/en/services/tax/ ... pdate.html
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I believe there is a "days in country" requirement for health care coverage as well...both by the province in Canada and possibly for US insurance. You may want to investigate that as well...
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BatCountry wrote: I believe there is a "days in country" requirement for health care coverage as well...both by the province in Canada and possibly for US insurance. You may want to investigate that as well...
Yes I've read that too re retaining ON Health care, it's on their website. But I wonder how it differs for the snow birds I did inquire from CAA and was told many purchase their own health care plans before leaving Canada for the season.
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Kiraly wrote: If you want to say something, why not say something instead of dancing around the issue? Exactly what are you so terrified of that you are considering leaving the country? The only specific thing you mentioned is "private property rights" which do not exist in Canada.
Perhaps I am using terminology that isn't clear. I am talking about rights and freedoms like the rights and freedom to own property such as a home. There are discussions that these things may no longer continue to exist as they are today in Canada in the future. I believe there are forces that want to change these types of things in Canada but whether they succeed is yet to be seen. This isn't the only thing that concerns me that is being discussed and while I would like to just live my life and not worry about these types of things, sometimes you see and hear things from sources and people that have enough credibility to see how the data points could come together. I have been right in many of my predictions in the past and so when something like this gives me an uneasy feeling, it is hard to ignore. I love Canada and have never seriously thought of living anywhere else but if the values and fundamentals of any country were to change in a big way, I think it would really call into question whether you could look at the country the same way.
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choclover wrote: Perhaps I am using terminology that isn't clear. I am talking about rights and freedoms like the rights and freedom to own property such as a home.
Canada does not and has never had that as a legal right for citizens or residents. So you can't lose what you don't already have.
This isn't the only thing that concerns me
Again, no specifics. So I ask again, what exactly terrifies you so much? It must be huge if you are considering leaving the country over it. If it is that serious then why don't you tell is what it is?

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