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Moving from US to Canada....questions

Moving from US to Canada....questions

Old Apr 3rd 2003, 1:30 pm
  #1  
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Joined: Dec 2002
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Default Moving from US to Canada....questions

Hi,

I received my Canadian Permanent Resident visa (family sponsored). I am planning to move to Canada to be with my wife by the end of April. I am in US on H1B visa and am wondering when I actually land in Canada, do they ask to cancel your existing US work visa...??

Should I prepare any tax documents of my income for this year..?? What would happen to my Social Security Number..?? Does it gets cancelled too..?? I plan to quit my job before the move. Do I need to complete "Sailing or Departure Permit"...??

If anybody could share their experience if they were on H1B visa in US and moved to Canada, it would be really helpful.

Regards,
CK.
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Old Apr 3rd 2003, 7:19 pm
  #2  
Vladimir Menkov
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Default Re: Moving from US to Canada....questions

In article ,
AAABBB wrote:
...
    >I received my Canadian Permanent Resident visa (family sponsored). I am
    >planning to move to Canada to be with my wife by the end of April. I am
    >in US on H1B visa and am wondering when I actually land in Canada, do
    >they ask to cancel your existing US work visa...??

Who "they"? From the current Canadian law point of view, it is
immaterial what kind of visa you hold for the USA or other foreign
countries. What the Canadian law (IRPA) requires is that if you want
to maintain yoru PR status in Canada, you have to spend at least 730
days in Canada within every 5 year interval.

From the US law point of view, your H visa, I suppose, becomes invalid
for entry to the USA if you are no longer working for the US company
that sponsored you.

    >Should I prepare any tax documents of my income for this year..?? What
    >would happen to my Social Security Number..?? Does it gets cancelled
    >too..?? I plan to quit my job before the move. Do I need to complete
    >"Sailing or Departure Permit"...??

Your SSN is for life. You'll use it in the future US non-resident tax
returns, if you ever have US income.

You file now (by April 15, 2003) your US resident tax return for the
year 2002; a year later (by April 15, 2004) you will file your US tax
return for the year 2003. The rules for the 2003 return may be fairly
complex; depending on how much time you have spent in the USA this
year, this may be a full-year non-resident return (1040NR) or a
dual-status return (form 1040NR reporting the US income received after
leaving the USA, with a "statement" on form 1040 attached reporting
the income for the first part of the year, prior to leaving the
USA). Read IRS Pub. 519 for more details.

As the treatment of certain forms of income (cap gains or dividends,
for example) is quite different for US residents and non-residents
(and for the latter, it depends on their country of residence), you
may want to do some planning to decide whether you dispose of certain
property before or after migration. For example, if you own some stock
with an unrealized cap loss, it may be better to sell it while you are
still a US resident, so that you can have a tax loss deductible
against your other income. If you sell it after you migrate, there
will be no US tax event (non-residents are not taxed on cap
gains/losses), while you won't have much of a loss to show on the
Canadian tax return, since Canada follows the "deemed acquisition"
rule (i.e., your basis for the purposes of Canadian capital gain/loss
is the fair market value at the date when you started living in Canada).
On the other hand, if you have an unrealized gain, you may want to
defer the sale until after you migrated.

The "Sailing Permit", 1040C, is still on the books, but you don't
really need to file that, since most of the US income (wages) was
subject to payroll withholding anyway. You will be reporting it on
your tax return in April 2004 anyway.

--Vladimir (Penticton, B.C.)
 
Old Apr 3rd 2003, 8:20 pm
  #3  
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Joined: Dec 2002
Posts: 44
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Default

Thanks Vladimir for the wealth of information. You answered most of my questions.

By "They", I meant either US immigration or Canadian immigration officials.

I have couple of questions more....

What would be the process of filing my US tax return of income I earned in 2003 before leaving US..?? Can I file it from Canada..??

As I will be selling my personal property (Car) before leaving US, so would that be included in my taxable income for this year and hence become part of my tax filing next year..??

Regards,
CK.
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Old Apr 3rd 2003, 11:11 pm
  #4  
S B
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Default Re: Moving from US to Canada....questions

AAABBB wrote:
    >
    > Thanks Vladimir for the wealth of information. You answered most of my
    > questions.
    >
    > By "They", I meant either US immigration or Canadian immigration
    > officials.
    >
    > I have couple of questions more....
    >
    > What would be the process of filing my US tax return of income I earned
    > in 2003 before leaving US..?? Can I file it from Canada..??
    >
    > As I will be selling my personal property (Car) before leaving US, so
    > would that be included in my taxable income for this year and hence
    > become part of my tax filing next year..??
    >
    > Regards,
    > CK.

Personal property is not considered as income if it depreciates, but it
may have to be listed.
 
Old Apr 4th 2003, 1:35 am
  #5  
Vladimir Menkov
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Posts: n/a
Default Re: Moving from US to Canada....questions

In article ,
AAABBB wrote:
...
    >What would be the process of filing my US tax return of income I earned
    >in 2003 before leaving US..??

In April 2004, you prepare a dual-status return (on Form 1040NR, with
a "statement" on Form 1040 attached to it), as per instructions that
come with 1040NR and in Pub. 519.

    >Can I file it from Canada..??

Yes, of course. You put a CDN$0.65 stamp on the envelope, and send it
to the same IRS address in Philadelphia to which all non-resident
returns are sent.


    >As I will be selling my personal property (Car) before leaving US, so
    >would that be included in my taxable income for this year and hence
    >become part of my tax filing next year..??

As Stuart said, there are likely no tax consequences for selling
personal property, in either country (unless there is a gain).

--vld.
 

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