Category: U.S & Cross Border Tax

As a Canadian, do I have to file a US tax return for online sales made to the US?

Question: I operate an online business in Canada, as a sole proprietor, which sells goods in the US. What are my US tax filing obligations? Answer: As a Non-Resident alien earning self employment income in the US, you are required to file a US non-resident personal tax return, 1040NR. You must also file Schedule C … Continue reading As a Canadian, do I have to file a US tax return for online sales made to the US?

If I am employed by a US company but perform work both in Canada and the US, should I just receive a W-2?

Assume that you are a Canadian resident and you perform work for a US based company in Canada and the US. The following will occur: The US employer must allocate your total employment income between Canada and the US, based on the number of days worked in each country. This means that you will be … Continue reading If I am employed by a US company but perform work both in Canada and the US, should I just receive a W-2?

What is the Canada-United States Income Tax Convention and how does it affect me?

The convention is a tax treaty between Canada and the United States that “overrides” certain areas of the tax acts to offer protection against double taxation.  If you are a US resident and earn income in Canada, or if you are a Canadian resident and earn income in the US, then the treaty can provide … Continue reading What is the Canada-United States Income Tax Convention and how does it affect me?

Which US states allow the formation of LLLPs for US real estate investments?

Question: I’m a Canadian citizen and resident. My Canadian accountant told me to purchase US real estate through an LLP or LLLP. Which states allow for LLPs vs LLLPs to be setup? Answer: Unlike LLPs which can be formed in any state, only certain states offer the option for the creation of an LLLP. These … Continue reading Which US states allow the formation of LLLPs for US real estate investments?

What’s the difference between an LLP and LLLP with respect to US real estate purchases?

Question: I live in Canada and I’m a US real estate investor. I want to set up a limited partnership in the US for real estate I own but I have no idea what the difference between an LLP and an LLLP is. Answer: In an LLP (limited liability partnership), the partners assume the management … Continue reading What’s the difference between an LLP and LLLP with respect to US real estate purchases?

If I am a non-resident of the US, do I need a social security number to file taxes?

As a non-resident of the US, you will require an ITIN (International Tax Identification Number) to file US Tax Returns. In order to receive this number you will need to fill out form W-7 and attach it with your US Tax Return for the year.

If I am sending Canadian employees to work in the United States, do I need to withhold social security taxes from their pay in both Canada and the USA?

If you own a Canadian corporation that is sending Canadians to work on its behalf in the USA, the USA-Canada tax treaty gives you the option of not withholding social security taxes from your employees’ pay-cheques. To be eligible for this provision, you must apply for a certificate of coverage.  

A US corporation is considering doing business in Canada. What are some of the formalities that must be fulfilled?

You must obtain a Business Number, Sales Tax Number (i.e. GST #) and a Payroll Number, if there are employees. If the corporation does not have a physical presence in Canada, then a Treaty-based corporate tax return must be filed every year in order to avoid paying income tax. Otherwise, absence of filing will result in the corporation … Continue reading A US corporation is considering doing business in Canada. What are some of the formalities that must be fulfilled?

How can I avoid double taxes on my payroll if I am a US citizen working in Canada?

Question: I am a US Citizen taking up work in Canada this year. My family and home will still reside in the US. How can I avoid double taxes on my payroll? Answer: If you a resident of the US, and you work in Canada, you can file an election to have your US Payroll … Continue reading How can I avoid double taxes on my payroll if I am a US citizen working in Canada?

What happens if you take out your US Retirement savings after moving to Canada?

Under Canada and US tax rules, funds withdrawn from an IRA or 401K are taxed as income in year of withdrawal. The amount withdrawn must be included as income on your Canadian tax return. However, you can claim a a tax deduction for the entire amount of the withdrawal, if all amounts are transferred to … Continue reading What happens if you take out your US Retirement savings after moving to Canada?
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