How to File US Tax Returns in Canada – Ultimate Guide (updated for 2023)


IMPORTANT: If you need help with your US and/or Canadian tax returns this year make sure to complete our tax season intake form here. We don’t always have capacity to help, however I always do my best to try and find someone an accountant that can.

We’ve certainly had significant changes to US tax law over the last few years. These changes have also had a profound impact on the filing of US tax returns for US expats living in Canada.

In this guide I hope to outline in detail the tax filing requirements of US citizens living in Canada. Please note however that those that are moving or retiring to Canada will have additional tax filing requirements and planning items to review in the year they move to Canada. These issues will be outlined in subsequent articles as this guide will review requirements for expats who have already transitioned to Canada, or those that have lived in Canada their entire lives. If you are moving to Canada and need help planning for the move please contact me here to schedule a time to chat.

Please feel free to comment below with any questions or feedback, and please don’t hesitate to email me at or call or text to 250-661-9417 as I would be happy to help answer any questions you may have.

VERY IMPORTANT: Please note that the preparation of cross border tax returns involve a significant amount of technical and professional experience. The potential for very costly filling penalties is extremely high for anyone that attempts to file these type of tax returns without proper experience or guidance from a cross border tax professional. Not only is a deep understanding of both the Canadian and US tax system required but a further understanding and application of the US-Canada Tax treaty is required to file such returns.

Also note that the discussions related to tax calculations and forms below are very general in nature and should not be construed as tax advice. Your situation will be specific to you and your circumstances and you will want to review your tax situation with a qualified cross border tax professional.

Now that we got the DISCLAIMER out the way, let’s move on to How to File US Tax Returns in Canada:


US expat citizens are required to continue filing US tax returns even though they are not living as residents in the US. Essentially, regardless of where you live in the world, if you are a US Citizen or US Green Card Holder, you will be required to file US tax returns.

Whether you were born in the US or born of US parents and now live in Canada, or have moved from the US to Canada, you will be required to file both Canadian and US tax returns while a resident of Canada.

Note that the discussions related below with respect to filings and required forms are for those that are fully compliant and caught up on their US filings. If you are a US citizen living in Canada that still needs to catch up on your tax returns please review the Streamline tax program for more information on becoming compliant. This will also allow you to receive your economic impact stimulus payment as an expat of the US.

Basic Filing Requirements

Two basic filings will be required of US Citizens living in Canada:

  • T1 – Canadian income tax return
  • 1040 – US income tax return

Unless the taxpayer is under the respective income filing thresholds, a US citizen living in Canada will have to file both a Canadian and US income tax return each year.

Regardless of whether a taxpayers meets the income filing threshold for the year I always advise to file a tax return to ensure you don’t have to deal with unnecessary communications with the IRS or CRA.

Tax filing deadlines for 2022 tax year are as follows:

  • Regular Canadian T1 income tax return deadline is May 1, 2023
  • US 1040 income tax return deadline is April 18, 2023 with extension available via form 4868

US Citizens living abroad are granted a 2 month automatic extension to June 15th. No prescribed form is required to elect for this extension, however you should be including a statement on your 1040 to inform the IRS that you live abroad and are eligible for the automatic extension.

Taxpayers living in Canada can request via form 4868 to further extend the deadline of their US filings to October 15 of the year.

There is also an additional filing extension available to taxpayers to December 15th, however I highly recommend that taxpayers file by October 15th at the very latest. If you truly need more time to file your return for reasons outside of your control you can contact the IRS to request a further extension to December 15th.

To request for this additional extension write the IRS and include the following:

  • Name and Social security number
  • Tax year in which you’re requesting the extension
  • The reason for the extension request

Once drafted you’ll want to send the letter to the IRS to the following address:

Department of the Treasury
Internal Revenue Service
Austin, TX 73301-0215

Additional Filings

Foreign Bank Account Reporting

In addition to income reporting, both the US and Canada have specific filing requirements that require taxpayers to disclose foreign income and assets to each respective country:

US FBAR forms (US 114 form) – Form 114, commonly referred to as FBAR forms (Foreign Bank Account Reporting) require US persons to report their non-US banks and investment accounts to the US treasury department. These forms are extremely important for a few reasons. First, they are often missed by US taxpayers. Second, those that fail to report financial accounts on an FBAR could face significant penalties.

FBAR penalties can be up to $10,000 per unreported account or 50% of the value of unreported accounts. Unlike the T1135 outlined below, the FBAR is not filed with your US tax return and is filed separately and electronically with the treasury department. Form 8938 reporting foreign financial accounts is also required, however this form is filed with the 1040 and discussed in more detail below. Taxpayers are required to convert their Canadian holding balances to USD at year-end exchange rates.

T1135 foreign income verification form – This Canadian form is required for those taxpayers that own non-Canadian domiciled assets that have a cost of more than $100,000 CAD. Assets include bank and investment accounts outside of Canada, including real property, but exclude assets such as US IRAs and personal US vacation properties. This form carries a penalty of $25 a day to a maximum of $2,500 if filed late. Something very important to note is that if you have US based non-registered accounts you’ll need to complete a fairly detailed T1135.

For US investments in a Canadian investment accounts you are only required to report totals based on a country by country basis. If these same US investments are held in a US investment account they need to be reported separately. This difference in reporting is significant and could be the difference between thousands in tax preparation fees or countless hours of time to prepare the form yourself. In these cases we tend to advise clients to review the option of transferring their US investments to Canada if possible.

US Tax Forms and Schedules Required for Expats

Please note that there are many other US income tax forms that may apply to a taxpayer’s situation. The forms below however are those that are most common for those American’s living in Canada that need to file US income tax returns:

1040 – This is the main US income tax form that gets filed each year. It contains the name, address, dependants and income of the taxpayer(s). The form summarizes income and tax calculations for the year. You’ll have the option of filing your tax return as single, married filing jointly, married filing separately or head of household.

In most cases, dual citizens living in Canada will file MFJ and US citizens with Canadian non-US citizen spouses would file MFS. In limited circumstances we might elect to have the non-US spouse file jointly, however this is quite rare. We also may use the head of household filing option in limited cases. In order to be eligible for head of household filing status a US citizen filer must have a non-US spouse and a US dependent to make this filing status choice.

Schedule 1 through 6 – I won’t spend a lot of time on these schedules as they were introduced in the last few years to help consolidate information lines on the 1040 jacket and other forms. Most of the information on these schedules will come from other forms discussed below.

Schedule A – This schedule calculates all the itemized deductions available to claim. In many cases and considering how a lot of these deductions were eliminated in recent US budget, and the fact that the standard deductions have increased significantly, we tend not to use schedule A for US persons in Canada.

Not only that, but often, regardless of how much we reduce US tax, clients often don’t pay US tax because all US tax calculated on the 1040 is reduce by Canadian tax via foreign tax credits and form 1116 (more on this below).

Schedule B – This schedule outlines investment income of the taxpayer for the year. This form also contains a section often missed by expat tax filers. At the bottom of schedule B includes questions about foreign financial accounts, FBARs and 3520s. These questions are required to be answered.

Schedule C – Profit and loss from business are reported on this schedule. For those that earned self-employment income they will report these activities on schedule C. Note that dual resident taxpayers living in Canada will not be required to pay both Canadian CPP and US self-employment taxes. Under the US-Canada totalization and social security agreement, social securities taxes on self employment income is only payable in the country where the taxpayer is a resident (more on this below). Therefore, US citizens and taxpayer that live in Canada are only subject to Canadian CPP payments and not US self-employment taxes on self-employment income.

Schedule D – Capital Gains and Losses are reported on schedule D. Fairly self-explanatory, capital gains transactions are reported on this schedule including both public and private assets. A big difference between the treatment of capital losses between Canadian and
US income tax rules is that Canadian tax rules do not allow a deduction for capital losses against any income that is not capital gains. On the US side, those filing separately are allowed to deduct $1,500 and those filing MFJ are able to deduct $3,000 of capital losses against other non-capital income respectively.

A common mistake made by those filing their own cross border return or by those with a lack of experience is an incorrect calculation of capital gains for both US and Canadian purposes. Because the reporting of income on the Canadian and US income tax return need to be converted to respective currencies, the gain and loss on both sides of the border will need to be properly calculated at appropriate rates.

We convert income items such as pension, employment and business income on an average rate throughout the year. However, capital gains need to be converted at actual rates. For example:

Let’s say a Canadian resident purchased $10,000 of US stock in previous years when the FX rate was $1.10 USD/CAD. She then sells it in the current year when the stock is worth $11,000 and the FX rate is 1.30 USD/CAD. Her Canadian gain is not $1,000 x the average rate for the year (often the mistake made on tax returns we see prepared by others), but rather it is $3,300 calculated as follows: proceeds of $14,3000 ($11,000 x 1.3) less cost basis of $11,000 (10,000 x 1.10). However, her US gain in this case would simply be $1,00 ($11,000 less $10,000).


The Canadian gain is simply higher because of the change in exchange rate from the time the stock was purchased to when it was sold. It’s important to properly calculate capital gains this way for expats as the movement of currency exchange rates can significantly affect the amount of gain/loss reported on each respective tax return.

Schedule E – This schedule reports a variety of different types of income. In general schedule E reports income and losses from rents, royalties, income from partnerships, S-corps, trusts and estates.

Schedule F – Schedule F reporting income and losses from farming activities. Fairly straight forward.

Schedule SE – US Self employment taxes are calculated on this form. As outlined above, in most cases SE tax is not imposed on self-employment income earned by US citizens living in Canada. As such, no SE taxes would be calculated on this form for Canadians. In these cases a disclosure will be required to included in the return to ensure no SE tax will be owed.

Form 1116 – Form 1116 is one of the most important forms for expat returns. This form allows a US taxpayer living abroad to claim foreign tax credits on taxes paid in Canada. Incorrect preparation of this form can result in material misstatement of taxes and can result in a double taxation. The US-Canada tax treaty is in place to help eliminate double taxation between both countries. Hence the reason why form 1116 is so important to understand when preparing returns for Americans living in Canada.

Essentially, form 1116 allows a US taxpayer to claim a foreign tax credit for income tax paid on income to another country. In this guide we will discuss form 1116 in context of Canada and the US, however in many situations a US taxpayer will have an 1116 claim for foreign taxes from multiple countries.

In general terms form 1116 calculates the amount of foreign income that is taxed on your US tax returns and the corresponding foreign tax (in this case Canadian) on this income.

There are 3 “pools” of foreign income that get calculated on separate 1116 forms:

  • General income – pension income, employment, business income, etc.
  • Passive income – investment income, dividend income, interest, capital gains, etc.
  • Resourced income – this 1116 calculates a foreign tax credit on US source income that is not taxable in the US pursuant to the treaty. Some examples includes US source interest, US source capital gains and tax on US pension and dividend income in excess of 15%
  • Global Intangible Low-Rate Income Tax – More on this below

Generally form 1116, in reach respective pool, calculates how much of a foreign tax credit you will get on each “pool” of income. Note however that you will only receive a foreign tax credit for the lesser of the actual tax you paid on foreign income and the amount of US tax paid on the same income.

The nuance of 1116 tax calculations is beyond the scope of this guide, however if you have specific questions on these forms please leave your comments below and I’ll try to answer them as best as I can.

Also note that in addition to the 3 pools outline below, there is also 1116 AMT forms. More on Alternative Minimum Tax forms below.

Form 2350 – This form allows you to request an extension of time to file your tax return. This form is limited to situations where taxpayers file form 2555 and in most cases it is much more efficient to simply file form 4868 to request a further extension. More on deadlines and extensions for US citizens abroad below.

Form 2555 – This form is quite common on cross border tax returns, however in most cases we do not use form 2555 for our Canadian/US clients. This form allows for a deduction, in certain cases, for foreign (non-US) earned income. Unless the client only has employment income we tend to use foreign tax credits and form 1116 to reduce US taxes to nil on Canadian source income versus using form 2555. The reason for this is that if we use form 1116 for earned income so we can carry forward general source foreign tax credits for use in subsequent years.

Note that specific elections need to be made if you decide to stop using form 2555 to exempt foreign income in the US. Also, a simpler version of the form 2555-EZ is also available to those that are eligible.

Form 3520 and 3520-A – These forms, very much known and despised by expats and cross border tax professionals are often required to be filed in particular situations. Often when a American in Canada is a owner or beneficiary of a trust or receives a gift from a non-resident of the US these forms need to be filed.

Recent IRS procedures Rev. Proc. 2020-17 has exempted certain types of accounts that where previously classified as trusts for purposes of 3520 and 3520-A filings. Namely Canadian RESPs.

The assessment and filings of these forms is complex and requires proper advice. It’s important to review possible 3520 filings with your cross border accountant or lawyer.

Form 4506-T – Filing of this form results in a request for a US 1040 transcript. We file this form in order to satisfy reviews of foreign tax credits from CRA. When a US-Canada taxpayer claims a foreign tax credit on their Canadian tax return for taxes paid in the US the CRA often asks the taxpayer, through a pre or post-assessment review, for verification that they paid income tax on reported income. This transcript, once received, satisfies this request from CRA.

Form 4868 – This form allows a taxpayer to request an extension to file a tax return. Note however that US citizens living abroad have an automatic extension of 2 months from the regular US deadline. See the more detail explanation of extensions outlined above.

Form 5329 – This form calculates any additional tax on IRA plans that are assessed in cases such as early or non-qualified withdrawals. Many of our clients own both Canadian and US retirement plans and in limited cases this form needs to be filed. One interesting item to note is that traditionally penalties imposed on late IRA distributions were not allowable to be claimed as a foreign tax credit in Canada. Due to changes in administrative policies at CRA, now penalties on IRA distributions can be claimed as part of your Canadian foreign tax credit claim.

Form 5471 – The 5471 is extremely important for a few reasons:

  • this form is often missed by taxpayers
  • if missed or filed late it carries a $10,000 first offence penalty and $25,000 repeat offence penalty
  • this form is terribly complicated to complete and requires an in-depth knowledge of both Canadian and US income tax rules
  • the recent US US tax changes under the Tax Cuts and Jobs Act of 2017 resulted in significant change to this form including Global Intangible Low-Tax Income regime.

The complexity of the form is well beyond the scope of this article, however I’ll do my best to summaries it here:

Most US Citizen and resident taxpayers that have more than a 10% interest in a private foreign (non-US) company are required to file the 5471. In some cases when the foreign company is inactive the taxpayer is only required to file page one of the form. In the context of this guide most Canadian taxpayers that also file US returns, and are shareholders of a Canadian corporation, must file a 5471.

This form reports the following:

  • General information about the corporation and shareholders
  • Information about the corporations income statement, balance sheet and equity statement all converted to US dollars
  • Information on how the US shareholders were compensated from the company and related loans to shareholders
  • Calculation of GILTI income if applicable
  • Calculation and tracking of Subpart F income if applicable (more on this below).
  • Other forms tracking these calculations:
    • Schedule I-1 – GILTI tracking
    • Schedule J – Accumulated E&P of CFC
    • Schedule M – Transaction of a CFC
    • Schedule O – Organizational transactions
    • Schedule P – Previously taxed earnings tracking

Very generally speaking, if a US taxpayer owns shares in a private Canadian company they will need to assess the following:

If the company is controlled by a US person or groups of US persons it’s likely considered a “controlled foreign company” for US purposes. If so, the taxpayer will be subject to certain additional tax rules such as Subpart F income rules and GILTI rules. In short, any active business income (GILTI) or inactive income (subpart F) will be subject to US tax regardless of whether it was distributed to the shareholders. In certain cases however we can mitigate any additional US tax owing by properly planning before the tax returns are due or by applying foreign tax credits to the taxpayer’s 1040 to claim a credit for Canadian corporate taxes already paid (this is a very complex area that requires professional assistance).

If a Canadian corporation is not controlled by US persons, but that particular US tax taxpayer does have an interest in the corporation, the 5471 is still required to be filed, just with less forms and calculations.

To add a further note to the 8621 discussion below. If a Canadian corporation is considered a CFC it will not also be considered a PFIC, and therefore will only be required to file form 5471 and not form 8621.

IMPORTANT NOTE: the 5471 discussion above is very general in nature and does not take into account all the complexities of CFCs or PFICs. If you are a US citizen that has an interest in a non-US private company please reach out to a cross-border tax professional for advice.

Form 6251 This form calculates whether a taxpayer will be subject to Alternative Minimum Tax (AMT). The purpose of AMT is to ensure taxpayer pay a minimum level of tax on their tax returns when in certain years, due to large deductions or low rate income. For example, if a taxpayer’s regular rate of tax on income is 15% and the calculation AMT rate is 20%, the taxpayers additional AMT will be 5%. Essentially their overall (minimum) tax rate would be 20%.

Form 8275 – Often we are required to disclose certain items or positions on tax returns that may not be obvious to the IRS. This is especially true for cross-border tax returns. These positions are disclosed on form 8275 and include the specific IRS code and regulation section discussed.

Form 8621 – Not necessarily a common form for domestic American residents, but for any Americans living in the US with Canadian mutual funds this form is likely familiar. Specific US tax rules do not allow US taxpayers from offshoring investments into foreign companies and deferring investment income on these investments. Hence the reasons why form 8621 and Passive Foreign Investment Company (PFIC) rules were developed.

In most cases, if a US taxpayer has ownership of a PFIC, defined as a foreign company that either has 75% of it’s income generated from passive source or it’s made up of more than 50% inactive investment income, this taxpayer will have to file form 8621.

Once again, similar to the discussion regarding CFCs and form 5471, the tax impact of owing PFICs will not be covered in this article. That being said, those that have ownership in Canadian or non-US investment companies should seek specific tax advice for their US filings.

One important thing to note is that, in many cases, Canadian mutual funds meet the strict definition of a PFIC. Therefore Americans living in Canada, that own Canadian mutual funds will be subject to PFIC reporting and form 8621. In many cases however the Canadian fund company provides specific tax forms to the US taxpayer that makes the filing of form 8621 much less onerous.

Schedule 8812 – This schedule allows you to claim the fairly large child tax credit. The credit is up to $3,600 per child. That being said only Canadian taxpayers with children that are US citizens with valid social security numbers or children that are physically present in the US are eligible for this credit. In cases where your children are eligible for a SSN, you should obtain the SSN in order to obtain this generous credit.

Form 8833 – This is an extremely important forms for US expats. This form is used to claim a treaty deduction or position on a 1040 income tax return. This form also carries a $1,000 penalty is not filed in a timely manner.

Some common examples of 8833 disclosures that US citizens in Canada file are as follows:

  • disclosure to exclude payments of self-employment tax on business income
  • disclosure to resource certain types of US source income such as interest income and US capital gains
  • exclusion of CPP, OAS and US social security payments
  • To claim a treaty protection on business income related to a Canadian permanent establishment

Form 8840 – This form is really only filed with 1040NR returns or as a separate form with the IRS. In cases where non-residents of the US spend enough time in the US (under the substantial presence test) they are allowed to file this form to outline to the IRS that they are a more closely related, for tax purposes, to a foreign country. In effect, not requiring the taxpayer from having to file a full 1040 income tax return even through they meet the substantial presence test.

Form 8854 – This form is specifically required for those that have expatriated in the year. This form reports a taxpayers renunciation from the US and related tax consequences.
A discussion of this form is beyond the scope of this articles, however some main points are as follows:

  • When a US citizen applies and is eligible for citizenship renunciation the taxpayer needs to file from 8854 for the year they expatriated
  • If the expat’s net worth is less than $2,000,000 then the tax impact of expatriation is relatively straight forward (other than the last year of filing requirements).
  • If the taxpayer is over $2,000,000 in net worth at the time of expatriation the taxpayer is considered a “covered expatriate” and further tax consequences result.

K1 Form Entries – The K1 form is actually a slip you’ll receive if you are a shareholder of an LLC, partnership, S-Corp, C-Corp or if you are a beneficiary of an estate or trust. Although this is not a form in the 1040 it is a slip that many US citizens in Canada receive that need to assess when they file their US income tax return. A Canadian resident may receive the following types of K1 forms:

  • K1 from an S-corp of LLC – This form will allocated income of an S-corp or LLC to a taxpayer. It will note only allocate this income, but outline what type of income is allocated. Note however, that these US style flow-through entities are often not very efficient for Canadian purposes and often result in double taxation. If you or your client receive K1 distributions of any kind please reach out to a competent cross border tax professional for advice on how to deal with these allocation slips
  • K1 from US partnership – This form allocates income to a taxpayer from a US partnership
  • K1 from trusts and estates – A taxpayer will receive a K1 often from trusts or estate for which they are beneficiaries. Once again, the tax rules related to distributions to taxpayer from foreign trusts and estates are complex and require proper review and planning. Canadians reporting trust and estate distributions from foreign sources should also be filing form T1142 to properly report these distributions (more on this below).

Form 8858 – In cases where Americans living in Canada run sole proprietor business or other foreign disregarded entities form 8858 is required to be filed with the 1040.

Form 8938 – This form, similar to the FBAR form discussed above reports foreign financial accounts to the IRS on 1040. Some main differences between the FBAR forms and the 8938 forms are as follows:

  • The FBAR is filed with the treasury department apart from the actual 1040 income tax return.
  • The 8938 is filed along with the 1040 income tax return
  • Unlike the FBAR, certain types of foreign pensions are required to be reported on form 8938
  • Signing authority over corporate bank and investment accounts are required on the FBAR, but not on the 8938
  • The 8938 also has additional information required on the form including whether an account has been closed in the year and how much income is generated in total from foreign accounts

Form 8960 – This form calculated the original Obamacare net investment income tax. This additional tax was introduced a few years ago to help fund the US medical system under Obamacare. Canadians are also subject to this additional income tax. The additional income tax of 3.8% is on investment income above certain thresholds, $125,000 for those filing single or married filing separately and $250,000 for those filing jointly. Note that this 3.8% tax is only on investment income above these thresholds.

However, this additional tax is not part of “regular income tax” and therefore not able to be reduced by a foreign tax credit via from 1116. Hence, taxpayers with investment income over the thresholds above may face additional US tax that cannot be offset by Canadian taxes.

Form W9 This form, often requested by investment and banking institutions is simply a request from a US citizen for their US Social Security Number. This form is held by the institution requesting the form and is not sent to the IRS or treasury department.

You’ll notice from the forms above that many of the “deduction” forms are not included. This is because in most cases, regardless of how much you reduce US taxes on a 1040 you have more than enough Canadian taxes to offset this amount. There are certainly cases where we need to use deductions on specific forms or those on schedule A, however these cases are not very common for expats.

The guide above outlines what forms to file on a US 1040 income tax return while a resident in Canada. The filing of Canadian returns for US residents is not outline in great detail. However to help provide some insight I’ve outlined some of the main points and additional forms a US citizen would want to review when filing their Canadian return:

T1 Canadian Income Tax Return Forms for Expats:

T1135 – Similar to the FBAR forms outline above the Canadian tax authorities also want to know about your foreign assets. Form T1135 was discussed above.

T1142 – In situations where Canadian residents receive distributions from foreign trusts or estates they need to fill form T1142 to report both the capital and income portion of the distribution. Because many Americans living in Canada will, at some point in their lifetime, receive distributions from a US estate or trust, we tend to file this form fairly often.

T1161 and T1243 – In cases where a Canadian may leave Canada and become a non-resident of Canada for tax purposes (often by moving to the US), these forms are required to be filed on their Canadian exit return. Generally speaking, when a Canadian becomes a non-resident of Canada most of their worldwide assets (excluding certain assets such as Canadian real estate) are deemed to be disposed as if they were sold. Form T1161 and T1243 report these assets in that particular year.

T2203 – For taxpayers that provide professional services or do business in another province or country this form is required to properly calculated where this income will be taxed.

T2209 – This is a very important form for Americans with Canadian filing requirements. This form allows you (similar to form 1116 above for the US 1040) to claim a foreign tax credit for foreign taxes paid to other countries. For example, an American living in Canada earning US pension income will be taxed in the US first on this income. They will also be taxed in Canada on this income, but they will receive a foreign tax credit on form T2209 for the US taxes already paid or accrued, hence eliminated double tax on this income.

Canadian foreign tax calculations get reviewed by CRA on a very regular basis. If you’re going to calculate your Canadian foreign tax credits yourself ensure they are accurate in case CRA wants to review the calculations.

Note that many of the forms above carry high penalties if not filed in a timely manner.

Other Issues

Often, our American clients have taxable income from various states. Whether it’s income from rental properties or part year tax returns for those moving up to Canada. State tax returns are often required in addition to the Canadian and US income tax return.

The discussions above relate to filing requirements of US citizens only. Often Canadians that are not US citizens have to also file a US tax return, namely a 1040NR income tax return for non-residents of the US. Canadians may need to file a non-resident income tax return in the following cases:

  • Sale of property in the US
  • To report rental income in the US
  • To pay tax or claim a refund on under-withheld US source income (often US source pension income)
  • Reporting of gambling winnings
  • Report business earnings through a US permanent establishment

In cases where a Canadian or US taxpayer needs to make a revision or correction to their US or Canadian income tax return, form 1040-X or form T1adj are available respectively to make these adjustments.


As you can see from the outline and discussion above, the filing of US and Canadian income tax returns for Americans in Canada is almost always complex and multifaceted. Engaging an experienced US-Canadian income tax adviser to assist in these filings is always advised.

Every year we file over 700 US income tax returns for Americans living in Canada. If you need help with your cross border filings, or simply want to chat about services or questions you may have please feel free to reach out via email to or via phone or text to 250-661-9417.

I look forward to speaking with you.

Phil Hogan, CPA, CA, CPA (CO)


  1. Hi Phil

    I’m a doctor that recently moved from California to practice in Victoria. Most of the MDs up here are incorporated. Considering I need to file both in Canada and the US should I consider incorporation?

    I’ll also need help with my 2015 US/canada tax filings along with my wife and 2 kids.


    • Hi Ben

      Thanks for reaching out. The choice to incorporate will depend on several factors, however it’s often an efficient way to earn professional income.

      If you have the ability to defer or split income with a spouse the savings could be significant. We would however need to review both the Canadian and US tax implications of such a structure.

      Can you give me a call in the office at 250-381-2400 and we can chat.



  2. I live in Vancouver and have been getting my US tax returns prepared by a local CGA. He doesn’t charge much, but I’m concerned that he’s not as knowledgeable as he should be on these matters. I questioned by about the FBAR form and he said it wasn’t something to worry about. After reading about the penalties I’m starting to get worried.

    What should I do??


    • Hi Jerry

      I definitely wouldn’t agree that not filing FBARs is something not to worry about. If you haven’t filed prior year FBARs you may have some options for catching up these information returns.

      Please give me a call at 250-381-2400 and we can run through your options.



  3. Hi Ben,

    I’m a Canadian citizen and have recently got a US Green Card. I’ve a job in Canada and have been filing my return. I plan to take a re-entry permit for US, as I’m not yet planned to move to US. In the mean time, I understand that I’ve file my tax returns in US as well. What’s your advice?


  4. Hello, I am a canadian who is partner in an american LLC. Doing my work virtually from my home in Saskatchewan. This LLC is just starting, this is the 2nd year…I am also self-employed and generated revenue in Canada. I believe I need to file a return in US (Maryland) and file a return in Canada (no question on that). How do the two filing coincide? or do they?

  5. I live here in Edmonton Alberta since 2013, I am currently a Permanent Resident now since 2015. I am an American Citizen. I moved here because my mother passed away in 2013, i now live with my father. I only worked for my mother as her Caregiver since 2007 to 2012, five years. I never filed Tax Returns in the US. I am also planning to be a dual citizen in the near future and I want to know how to file US tax.
    I want you advice!
    Thank you!

  6. Hi Phil,

    I am a Canadian citizen who moved back to Canada in August. I had spent the last four years in the USA, 2 as a student and 2 working under the TN visa. Do I need to include the income I earned in Canada after my return in August on my USA tax return?


  7. Hello , I’m Canadian artist and travel to US for performing my music show , my promoters paying after they deduct 30 % us tax and 10% commission wire me the rest and other travel expenses manage by my Canadian promoters ans orgnizer ,need all step to do taxes and as Canadian to do this for us I m having p2 performing permission and EIN number that’s all
    Appreciated any help
    Ima Rez

  8. Hi Phil,

    I am attempting to file my American return on my own this year however there are no directions available regarding how to align my T4’s and W2 values. I’ve looked at all my old taxes and can’t seem to line the numbers up event when incorporating exchange rates at the time. I only have one T4 and my previous accountant charged $550 for this. Advice?

  9. Hello
    I moved from the US to Canada 09/2010 (filing my US returns only for that year). I did not work in Canada until 2/2013 (I had to wait for my permanent resident was approved). This year, I just recently found out I had to file both a US and Canada tax return.

    What is the best way to file now? I would need to file 2013, 2014, 2015 and 2016 (I filed a Canadian tax return all those years).

    Hoping that you can help me.



  10. Hi Phil,

    My husband is a US Citizen, living in Calgary for over 15 years as a permanent resident, and filing Canadian tax returns for his Canadian income.

    In 2016, in addition to his self-employment income in Canada, he also earned US income that he has on a W2 and also on a 1099-MISC as he spent 6 months in the US.

    He is reporting this income on a US tax return and will be paying US taxes on it. Does he also have to report it on his Canadian tax return given that he’s a US Citizen, with US Source income, and paying US taxes on it?

    Many thanks,

  11. Hi Phil, I was wondering if you could offer some guidance please. I’m a Canadian who won a small jackpot in Las Vegas where of course, they withheld 40% of my winnings. It equates to close to $400 – so trying to determine the best way to maximize what the US Government will “give me back”. Any help is very much appreciated. Thank you in advance.


  12. I am a non-resident alien of United States – 100% Canadian – I signed a entry level hockey contract ( American team) and received a signing bonus in 2016 ; I was not paid for any other services in the United States – I do not have a SSN or green card – do I have to file a US return?

  13. Do I file the Canadian tax return first and then file the 1040?
    How much do you charge for a U.S. person living in Canada to do
    their U.S. tax return? They earn $24,000 management fees per year.
    2012 income was nil.
    2013 income was nil.
    2014 income is $24,000.
    2015 income is $24,000.
    2016 income is $24,000.
    He is married and living in Canada.
    The spouse is a Canadian doctor.

  14. The US-Canada tax treaty stated that full-ear residents of Canada owe normal wage and dividend income to the CRA. Logically, it would seem that taxes should be filed with the CRA, which shares info with the IRS besides. Some people in this situation just file Schedule D every year without 1040 with the IRS I’m told by a tax preparer in the U.S. Technically they “filed”, just not a whole return. There’s no version of 1040 for expats in countries with treaties allocating any of the types of income that taxpayer earned to that country. If a taxpayer files 1040 saying they had income, and don’t pay it because they paid the CRA, isn’t there a risk the IRS will get confused and think you owe the IRS? Is a cover letter filed with 1040 sufficient to avert owing, or should the foreign tax credit be applied instead as though there were no treaty? Do treaty elections need to be made on a form and can that be filed with an amended return?

    I asked the IRS to make a written statement on this matter and they kept sending letters saying they need 45 more days. For 2 tax years I sent Schedule D only and have received no letters indicating this was insufficient to be in compliance. I’ve kept my Canadian address updated with the IRS.

  15. I am an American who made a *very modest income from one employer in 2016. I am married (to a Canadian) and have a Canadian bank account. I feel very confused about all the different filing schedules involved with the 1040 form.
    I’m guessing I don’t list my income from my T4 where you would put your W2 wages…this is all very confusing.
    Thank you in advance for any help…this is a very complicated process for such a simple income level.


  16. I recently moved to Canada from the USA and I have no idea about my tax situation. So can you please share some information about what I have to do? Do I have to hire an agency for this purpose?

  17. Hi Phil,

    I’m a Canadian, married with one child who’s 18 yrs. old. First Time to work here in U.S. I’m filing my TAX return here in U.S. and Canada as well. I already have my W-2 form. Need help cause I feel my company only withheld about 21.0% of my total income for TAX. What step do I need to do?

  18. Good Day,

    I moved from Seattle, WA, USA in OCT 2016 to live in the Toronto, ON area as a Canadian Permanent Resident and Landed Immigrant.

    I started working for a Canadian Bank as a full time “contract” employee (with no benefits) from NOV 2016 to NOV 2017, and I started at another Canadian Bank in NOV 2017 as a full time permanent employee with benefits, including a pension plan, which started this year (2018).

    I have been married to a Canadian Citizen since 2015 (she works in retail part time) and have been living with her since I moved up here in 2016 and we have a joint bank (checking/savings) account and I got my OHIP card 3 months after I moved up here.

    Please advise what CRA and/or IRS forms I should fill out.

    Thank you.

  19. My mother inherited money from her brother in the US and got a form 1099-R. Tax was withheld at 20%. Does she still need to file a 1040NR (will she get a portion of this tax back under a treaty agreement?)

  20. Phil. We are Canadians who sold our winter home in U.S. last year. We will have a capital loss on it and I was wondering if we still have to file a U.S. Income tax form. They did not hold back any money from the sale and we do not have a U.S. ID tax filer numer.
    Any information you can give us would be appreciated. Thank you

  21. Hi, I have an American passport and I currently live and working in Canada (and have for the past 3 years.)

    No one seems to want to deal/explain the 8833 form. I even emailed people who file american taxes, but they said they didn’t deal with things like the 8833 form ?

    And I have searched high and low on the internet for how to fill it in myself, to no avail. In addition to this, the IRS seems to take this form very seriously, with fines if it’s filled incorrectly.
    My situation really isn’t that complicated. I make a fixed income here in Canada, and I pay taxes, that’s it. Is there nowhere I can find how to fill in those 6 lines on the form ?

    Do I actually need to file this form ???

    thank you

  22. hi phil , i amcanadian citizen, i am insurance agent i have a commision income from usa , i filed my taxes in canada , i am wondering if i have to file taxes in usa as well please guide me




  24. I’m new at this. I moved back to Canada from US…i have dual Citizenship….my permanent resident is Canada…would like to know what form i need to fill out for Income taxes for US.

    Pls & Ty
    waiting for reply

  25. I am a dual Canadian and US citizen that will retire in the USA. When I withdraw my RRSP there will be a Canadian withholding tax of 25%. Is there any way I can offset this amount on my US tax return? Can I draw my US 401K amount and use the withholding tax credit against it?


  26. I’m a US citizen and my wife is Canadian only. most of my income is from Canada and I have some US pension income that I report on my 1040NR each year. I don’t normally pay very much tax on my US pension income, but I’ll be taking out much more from my IRA this year and I’ve estimates around 18% US tax. I’ve done a foreign tax credit on my Canadian return for investment income but not for my US pension income because I never paid much US tax on my pension and/or IRA.

    Also, is there any way to reduce the tax I pay on the withdrawals from my pension?



    • Hi Jasmir

      Some of what you outline above doesn’t make sense. If you’re a US citizen you should be filing a full US 1040 return and related forms such as FBARs and 8938s. Your worldwide income needs to be included on your 1040, not just your US source income. You’ll only be required to pay 15% tax on your US pension income as the additional tax will be resourced to Canada (fully taxed in Canada with a foreign tax credit for the 15% paid to the US).

      Other than Canadian deduction there will not be a great way to reduce tax on the pension. If I’m correct about the above filings you’ll want to ensure you adjust your previous tax returns to include your worldwide income. Give me a call and we can chat.

  27. I am a US citizen. I lived in Canada until May 2018. Half of my income in 2018 is Canadian and half is US income. What do I need to file US taxes? Canadian taxes?

  28. Hello, my daughter is a US citizen, and has been a resident of Canada since she was 6 years old. She’s now 19 and is working in Canada. She’s never filed in the U.S. (or Canada) before. I believe we can file online in Canada, and was wondering if she can file online in the U.S. Her earnings will be very small (less than $10,000 for 2018.) Can you advise on what the best course of action would be to make sure she maintains proper and legal standing w.r.t. U.S. tax laws?

  29. I am a Canadian / American Dual citizen. I am enrolled in Canadian Tax Free Savings accounts, and from what I understand any interest accumulated within those accounts are not tax free from a U.S. tax perspective. I have been listing interest earned as taxable in the U.S. tax forms. Now I am reading that TFSA’s should be considered as foreign trusts, and elsewhere that the TFSA should be classified as pension protected under Article XVIII of the Canada/US tax treaty. This is all very confusing, particularly when in comes to TSFA Mutual funds which I am considering closing due to what could be considerable reporting requirements with little future tax benefits. Any suggestions or pointers where I can find more information on the Tax implications of a dual citizen holding a TFSA would be greatly appreciated. Thank you.

  30. US Citizen who common-law married my fiance to move up to Canada. My wife is a medical student at a school in Toronto.

    I work remotely for a US company and earn 100% US income. Most of our liquid funds are in American accounts but we jointly own a Canadian bank account.

    We also have American investment accounts.

    We are not full-time residents. I have an 18-month TRP (filing for permanent now but don’t expect results for a year). Wife has 3.5 years residency to finish her program.

    I have no idea how all of these facts interface with Canadian or US tax authority rules. We could very much use some expert advise.

  31. Hi
    I am a Canadian and I received a 1042-S ( Foreign Person’s US Source Income Subject to Withholding). Do I need to file a US Income tax? IF yes, how do I go about doing that?

    Thank you

  32. Hi Phil, I am a US citizen living and working in Canada. I have a BASIC return to file but not sure I have been doing it right as I am doing it myself. I am just wondering how much your services are so I know I am doing this right. It seems silly to pay for someone to do my taxes but I also don’t want to be penalized for doing them wrong. Please let me know.

    PS. I completely forgot to do my US taxes last year and still need to file this years too.


    • Why does it seem silly to pay someone to help with taxes? I pay people to service my car, mainly because I have no idea how to do it myself.


  33. Hi I’m a Dual American/Canadian citizen living in Canada and preparing a return for the first time. I’m wondering about form 8833 and if I need to file this form. I’m preparing a basic return that includes income from Canadian T4’s and a small amount of tip income. I’m not familiar with any of the treaty provisions and not sure where to find information on them, or if I even need to file provisions at all. Let me know if you could help me out with any info. Thanks!

  34. My husband is a Canadian citizen who worked in the US on and off and he has a TIN #
    In 2019 the company he repped went under and he did not work at all in the US. Do we have to file a nil return?
    Thanks so much.

  35. Hi, I am a Canadian citizen. I got married this year and my wife is a US citizen working in the USA. I am still working in Canada as my green card is in process. I am filing my taxes in Canada. Do I need to include her income in the USA in my tax filing?

  36. Hi Phil,
    Being a Canadian citizen, my friend worked for 40 days in USA on TN visa earning $13k. Not a US citizen or GC holder, is he supposed to file 1040 or 1040NR? Not lived in USA in earlier 2 years for more than 60 days.
    Any relief under double tax agreemnt treaty

  37. Hello,

    I am an American expat living in Victoria the past 4.5 years. I opened a TFSA in August 2019 and have recently learned this
    is inadvisable for Americans. I was told that an RRSP would be better. I want to talk to an expert about this, and/or the ideal
    plan of action for me to invest my money while complying with the IRS. Thank you.

  38. For a Canadian working in as a US resident, where does one report income from T4A (RESP) on US tax returns? I’
    understand 3520 is no longer required to be reported on but do I report income on 1040 line 7a and schedule 1?

    • I found a document titled “The Navigator – U.S. Foreign Trust Rules for Canadian Trusts”. Since an RESP is classified as a Foreign Trust this applies. In my case, I see my wife owns the RESP and is a “Non-US Grantor” or “Non-US Non-Grantor” depending on the type of distribution. Either way, that is a non-taxable event. A US Grantor on the other hand would be required to do all the ordinary trustee duties such as providing a K-1 form so the recipient could file the taxes appropriately. However, before I figured that out I discovered because of the kiddie tax, it wouldn’t be wise to take a child as a dependent receiving a significant amount of income. Essentially that tax would transfer my tax liability to my son. So for every penny I saved my son would pay. Only my son has no foreign tax credits to compensate, I do.

  39. Im an American that worked in Canada last year and was told I can get back all my Canadian taxes back now that I am
    back in America. I was paying both Canadian and American taxes as an American living and working in Canada for 8
    months. Any help would be greatly appreciated.

  40. Hi. We just relocated to Victoria and we need a good accountant here who understands Canada/US tax laws as we have financial resources in the US. I also need consultation on what kind of business license I need as a professional offering training services (no employees). Thank you in advance for your speedy reply!

  41. Hi,

    I’m an American and Canadian citizen living in Canada. I have never filed taxes in the USA. I am up to date with my Canadian taxes.

    I am considering moving to the US (not right away – no rush) and would like to get up to date with my US tax filings. I need help with this and I’m also wondering what kind of cost I am looking at.

    Thank you,


  42. I hope you are well. I am emailing on behalf of myself and my husband. We are looking to get a professional to help us with our taxes this year and on a go forward basis.

    We are a military family that has been temporarily posted to Seattle WA in July of last year to July 2022. My husband continues to get paid by the government of Canada and most of our living expenses in the USA are covered by the military, in addition to our moving expenses. That being said, I worked half of the year in Canada while the rest of the time in US. We kept our home in Ontario and are renting it out to a tenant for the entire cost of the mortgage, but we pay our property taxes out of pocket, and have a property manager looking after the property for us. We have made many improvements to the home during that time that it was rented out.

    Our mail from ourhouse if being forwarded to my sister’s in Waterdown so unfortunately I don’t have my T4s with me in Seattle, but I’m sure that is something that you/I can pull off the CRA website when the time comes.

    I know that that was a lot if information but we want to be very transparent so we can get an accurate quote for your services, and also ensure that this is something you can handle. I will probably have to file my taxes in Canada and the US because I worked in both places, but that I’m not entirely sure of, hopefully you will know and provide the appropriate guidance for us.

    This is a complex but exciting file and I forward to hearing from you to help us with our taxes going forward 🙂

  43. Hello, I’m reaching out on behalf of a small family business here in Calgary.

    I need one who has expertise in US and Canadian tax law, US Social security policy, and simple business formation here in Alberta.


    The business is currently owned by a sole proprietor, who is on the title of the current retail lease (as a lessee), who would like to pass the business on to his Brother before the end of the month. The business has revenues of approximately $500K a year, with profits approximately around $50K per year.

    However, the Brother is a Canadian/US dual citizen who will also be eligible for US social security when he comes to retirement age. The brother is worried about US Tax implications and effects to his US Social security eligibility or payout.

    Questions – In the event the Brother is transferred the business title and renews the lease under his name:

    -Would the Brother have US tax obligations under US tax law?
    -Would the business affect the Brother’s future US Social Security eligibility or payout amount?

    -If a corporation is able to be formed for the Brother to run the family business through as the sole director and shareholder, would there be US tax obligations under US tax law?
    -Would the corporation affect the Brother’s future US Social Security eligibility or payout amount?
    -If there is an affect to the Brother’s US tax obligations or Social Security Benefits – would an arrangement of additional director/shareholders be able to mitigate these factors?

    -In the event that forming a corporation is a viable option – could it happen before the end of the month?

    -Are there other options?

    If you are able to provide some guidance on this matter that would be most welcome. If so, is there a time we could meet or call to discuss this matter (or alternatively, if we can do this via email) and possible quotes for your time? If the above is out of your scope of expertise, thank you for your time and any referrals would be appreciated.


  44. I am a dual citizen living in Canada. My only U.S. income is my social security which I pay tax on in Canada.
    Am I required to file a U.S. tax return?

  45. 1. My wife and I are Canadian citizens

    2. We bought a house in Regina, SK in 2015 and used first time Home Buyer Plan, each of us has about 5000-6000 dollars on
    balance to payback (i.e. buy back RRSP?)

    3. In Sep 2018, I moved to US with TN visa first and did not go back to Regina until Aug 2019 to move whole family to US.

    4. In Aug 2019, my son(10 years old), my wife, and I moved to Washington. My wife was TD visa or status. Then she changed to
    TN vista in Sept 2019. She changed status at the border between US and Canada near Washington/Vancouver. We left Washington border and entered into Canada at 9am, then got her TN visa at 1130am, and immediately back to Seattle, WA.

    5. Since she got her TN visa, we did not go back to Canada.

    6. Since I got TN in Sept 2018, I only spent 7 days in Canada, i.e., from Aug 10 to Aug 16 to pack the belongings and moved whole family to WA.

    7. Both my wife and I canceled SK driver licenses, both have US Washington driver licenses

    8. Both cars are registered in WA and insured by US Geico Co.

    9. Both of us plus my son are covered by my employer provided health insurance, all SK provincial health cards were cancelled.

    10. We are living in apartment in WA. The house left in Regina is vacant. The house was listed in the market for sale one week after we left Canada in Aug 2019. It was delisted in Feb 2020 due to hard sale and poor market. It will be relisted anytime soon.

    11. We still have TD and RBC banks checking accounts and credit cards in Canada, but only used rarely, mainly to pay house mortgage and property tax and utilities(gas, water, power, etc.)

    12. We do not plan to go back to Canada anytime soon, not in 3 or 5 years as minimum.

    13. Both of us have filed US tax returned and refunds have been received. 1040 and 1040 NR, respectively.

    Based on the above information, I seek advice from you on the following questions:

    1. We want to sever the tie with Canada from the perspective of tax return purpose. Do you think we can file FINAL tax return and EMIGRATE out of Canada, and CRA will accept this residential status change?

    2. Or we have to file Canada tax return with Residential Status?

    3. Can we set up phone consultation also?


  46. I was born and raised in the US and moved to Canada in 1993 at the age of 23. I have dual citizenship and have only been back there a few times in 25 years.

    I have not filed or paid any taxes in the US since I moved. I have just opened a brokerage account and I had to declare US citizenship and I now have some concerns.

    What is the first step in getting citizenship and taxes in order or to renounce US citizenship.

    Have a great day.

  47. Good morning,

    I am a Canadian non resident that has been living overseas for over 14 years. Over the years, I have build a decent company that located in Hong Kong. As my kids are growing up, I am looking to return to canada.

    I am looking for accounting or tax advisors that can help me structure my assets so I can return to canada. I understand that all my gains from overseas while I was not a resident of Canada won’t be taxed, my concern is how my asset in my companies, my yearly dividends or my potential sales of my company would impact my taxes here. Is there a better time to return to canada to reduce my taxes? Or should i have a specific corporate structure that I need to establish when I come back to Canada?

    If you are expert in this domain, please let me know.

  48. Thank you for your helpful site! I have a question regarding the sale of my Canadian home/personal residence. Do I need to declare that sale to the US government on my tax return?

    Also, I have been day trading this year. How detailed are the requirements in regards to disclosing this Canadian income?

    Thank you

  49. Hello,
    I am looking for advice on the following two issues:

    – The amount of net withholding tax a Canadian resident would owe to the IRS (USA) for royalty income under the Canada-US treaty, and
    – Under a double taxation treaty(s), is a person in any given year considered a tax resident of one and only one contracting country?

    The first one is on a US LLC that I own which could potentially be receiving royalties on its portfolio of utility patents through licensing (or damages as retroactive royalties through litigation).

    If I exercise pass-through taxation as a Canadian tax residence for the LLC for the year that the royalties are received, I believe the proceeds will be subject only to personal income tax.

    I understand that there would be a 30% US withholding tax on the royalties, and a 10% (max) tax from CRA, according to “The 1995 Canada-US Protocol:.”

    Does that mean that I can get a refund no less than 20% of the royalties back from IRS (US)? If that’s the case, is there an exact formula for a given type of intellectual property to estimate the refund amount?

    The second one is on tax residency in Cyprus (one of the lowest EU corporate tax rates at 12.5%). Information from CRA seems to state that one can be a tax resident of one and only one contracting country of a tax treaty:

    “If you leave Canada and keep residential ties in Canada, you are usually considered a factual resident, and not an emigrant. However, if you are also considered to be a resident of another country with which Canada has a tax treaty, you may be considered a deemed non-resident. Deemed non-residents are subject to the same rules as emigrants.” (Leaving Canada (emigrants) – CRA )

    So, does passing the test for a tax resident of Cyprus automatically makes one a non-tax resident of Canada, or would I need to take more drastic measures like disposing property, closing bank accounts etc. in Canada?

    Please let me know if your practice area covers rendering advice on those issues, and the applicable fees for the service. I will be more than happy to provide further details to allow you to further evaluate my situation.

    I am presently not in Canada due to being stranded by the travel restrictions in Yangon since early this year, but am expecting to be back sometime in September. However, I can be reached by email.

  50. Hello

    I am a dual citizen currently employed by an american corporation (Airbnb).

    I had moved to California from BC in January but have recently come back to Canada to be with my during Covid. She is in the process of getting a green card but they are no longer processing immigration applications right now so we are in limbo. We are currently living out of hotels/airbnbs and are thinking we will just buy a place here in BC to live in while we wait for her greencard to process. I am still renting my apartment in San Francisco even though it is unoccupied. I have canadian assets, bank accounts, and RRSP. I also have U.S bank accounts, assets, and 401k. I am concerned about my residency status and implications of purchasing real estate in Canada.

    I have filed my canadian tax return for this year but I have not filed my U.S tax return for 2019.

    This is just the tip of the iceberg when it comes to the complexity of my cross border situation. I would like to:

    1) Get cross-border tax advice on my residency situation and on the implications of purchasing property in BC
    2) File my U.S tax return for 2019.
    3) Come on as a client for future years to come (this has just gotten too complex to navigate by myself)

    We are hoping to buy the property soon and I wondering if you are available for a consultation in the next few days? Thanks

  51. I have a question regarding how to issue Canadian investors in a US based Partnership the US tax forms 1099-INT and Schedule K-1. We are a US Partnership but have several Canadian investors who were paid interest income and who own a small piece of the company since they invested in its startup.

    I need to file a US Fe Form 1099-INT for the interest that we paid to them and a Schedule K-1 for their distributive share of the company’s profits and losses, deductions, etc.

    I have requested either a US SSN or a TIN (taxpayer identification number) so that I can issue them these documents because that information is required for processing by the IRS and appears on the form as a means to identify the recipient of each form.

    However, the Canadian investors do not have a TIN issued by the IRS and are trying to give me a Canadian identification number instead, saying that they are not required to obtain a TIN number from the IRS and that I should use their Canadian ID number on these US forms 1099-INT and Schedule K-1.

    I do not believe that I can issue these US tax forms to them using their Canadian ID number; it is my understanding that I must issue Forms 1099-INT & Schedule K-1 using ONLY a U.S SSN or TIN number. Am I correct in saying that?

    Or is it permissible for them to receive those US tax forms issued to them using their Canadian issued ID number? Thanks so much for the clarification!

  52. Hello there, I moved to Canada in September in 2019. I have income made in the US before I moved, then have income made in Canada after I moved. When reporting foreign made income, do I need to list a particular line item from my US tax return or simply add up my net income made in the US and list this value?

    I reported my Canadian income on my US taxes, so my adjusted gross income is reflective of all income made in both US and Canada – I assume my deduction and paid taxes for the US are reflective of this joint value as well. When listing foreign paid taxes, do I simply list to the total value paid for the US or do I need to do some calculations to parse out what tax payment made in US was on joint US and Canada income vs simply US income?

  53. Is it still possible to get assistance with 2019 Canadian and US tax returns? I thought we would be able to figure it out, but am thoroughly confused the more I read.

    I am a US citizen and Permanent Resident in Canada as of . My husband is a Canadian Citizen and had permanent resident status in the US until 8/26/20 when he moved back to Canada (Winnipeg) to take a job. I have continued to work remotely for the University of Washington.

    I got confused by the revised deadlines and thought we had until July 1 to file in Canada, but now realize it is June 1 and am note sure how to figure this out and make sure we are doing it correctly.

  54. I will give you a little background so as to determine if you can help. My Daughter and her husband, who lived with my wife and I in Montreal Quebec had a job offer in Washington State. My daughter left Canada in February of 2019 with an L1 Visa to live and work permanently in the USA.

    Her husband followed after winding things down here. Because they had 2 dogs, personal items and furniture we decided to rent a vehicle and drive to Washington State. He left in mid April. They rented a condo and settled in. They left no substantial ties in Canada and their intention was to permanently move there.

    In October of the same year, 2019, circumstances made them move back. So the whole vehicle rental was done in reverse from Washington to Montreal. Therefore my daughter worked in Canada for January & February. Then she worked in Washington from March until October.

    Then she came back and worked November & December in Canada. Her husband worked in Canada from January until April. He did not work in the USA the whole time there. Then he worked in Canada in November and December. In trying to do the Canadian income tax for 2019 there seems to be a grey zone within the Canadian Tax laws in determining whether she is an Emigrant, Non Resident or Resident for tax purposes. Can you shed some light on this situation?

    Looking forward to speaking with you on the phone. Kind Regards.

  55. Hi, Phil,
    If a couple has file American Social Security tax return jointly, can they file it in Canada jointly too or has to file it separately

  56. Hi Phil,
    I’m a McGill Professor who grew up in the the US. I’ve always claimed the Foreign Earned Tax Deduction in past years, and never owed anything. This year it appears I may owe a bit – plus the fact that I’m filing late makes this especially annoying. However I believe if I use the Foreign Tax Credit instead I may be able to reduce my liability to zero and thus avoid late filing penalties as well. I know that my combined Canada/Quebec income tax is far higher than my US liability, but my question is am I allowed to include the Quebec income tax on my 1116 form or only CRA obligations?

  57. Lump-sum death benefit from Canadian pension, taxable in Canada to the beneficiary. Beneficiary is a Canadian resident dual citizen. On IRS form 1116, is this income General or Passive?

  58. I am writing to inquire about your tax preparation services for US citizens living in Canada.
    I am a US citizen currently living in Nova Scotia. My source of income is pension income from two of my previous employers in the US. My understanding is that I need to pay taxes to the Canadian government for my pension income; however, I have not worked in Canada since my arrival and have no income (employment, interest, dividends) sourced/generated in Canada.
    I bought a house in Nova Scotia about 17 months ago prior to my landing in Canada that I am currently living in but I have put it on sale and have received an offer for it. If the sale goes through/is finalized, my understanding is that I do not need to pay Capital Gain Taxes to the Canadian government since the house is my primary residence since coming to Canada but have to pay long term Capital Gain tax to the US government as I bought the house less than two years ago. I also bought a cottage in New Brunswick about 16 months ago; however, I sold the cottage after a year. My understanding is that I have to pay capital gain tax to both Canadian and US taxes. Due to the sale of the house and cottage, I believe I also have to file IRS form 8398 and submit it with my return (I filed FBAR online with IRS for 2021 and plan to do the same for 2022).
    I landed in Canada on December 23, 2021 and as such I prepared and filed Canadian taxes with CRA for 2021 (I used a software program) and paid no taxes. I also filled out and submitted form T1135 with my Canadian 2021 tax return listing stocks that I hold in a personal brokerage account in the US (I have no investment accounts in Canada). I also had my 2021 US federal and California state taxes prepared and filed by an IRS Enrolled Agent that I have been using for several years.
    Starting this tax year (2022) I plan to use the same tax professional to prepare both my Canadian and US (Federal only as I no longer am a resident of California) tax returns. As such, I am contacting you about my situation and receive feedback about your service offerings and remuneration.

    Thank you,

    P.S. I may go ahead and start working in Canada. Will that have an adverse impact on my taxes?

  59. Hello everyone,

    I am new to filing US tax returns and I am wondering if anyone can help me with the process of filing US tax returns in Canada. Would it be any different than filing US tax returns in the US? Are there any resources available that can provide more information on the process? Any help would be greatly appreciated.

    Thank you!

  60. A couple of questions for you…

    1. What are the regulations for bringing my car into Canada?
    2. What healthcare options are available to me as a resident of Canada?
    3. What support is available for me as an immigrant looking for employment?
    4. How does the school system in Canada compare to the US?
    5. What taxes will I be required to pay as a US citizen living in Canada?

  61. I had always dreamed of living in Canada, so when I was offered an opportunity to move there, I jumped at the chance. I packed up my life and moved across the country to start a new chapter.

    My first few months were full of excitement and adventure. I explored my new city and took in all the sights and sounds. I was so happy to be living in a new place and to be able to start fresh.

    However, my joy soon turned to worry when I received a letter from the Canadian tax department. Apparently, I had failed to file my taxes for the previous year. I was stunned. I had no idea that I had to file taxes in Canada and my ignorance of the law had landed me in hot water.

    I quickly consulted with a tax specialist to help me sort out the situation. I was relieved to learn that my mistake was not intentional and that I had simply not been aware of the requirement to file taxes in Canada. I was able to settle the matter with the tax department without any further penalties or repercussions.

    I learned an important lesson that day: no matter where you move in the world, it’s important to know the laws of the country. I’m thankful that I was able to learn it the easy way and not the hard way.

  62. t’s been 20 years since my husband and I moved from Canada to the United States. We’ve been living in the US for so long that we’ve pretty much considered ourselves Americans. But now we’re moving back to Canada and we’re starting to realize that we’re going to have to deal with a lot of things we hadn’t thought about before.

    One of those things is taxes. It turns out that even though we’ve been living in the US for two decades, we’re still considered Canadian residents for tax purposes. That means we’re going to have to file both Canadian and US income taxes while we’re living in Canada.

    It’s not just the income taxes that are causing us headaches, though. We also have to worry about something called FBARs – Foreign Bank Account Reports. These are reports that US citizens and residents have to file if they have foreign bank accounts with more than $10,000 in them. And since we’ve been living in the US for so long, we have a lot of accounts that we need to report.

    It’s all a bit overwhelming, to be honest. We never thought about any of this when we decided to move back to Canada. But now that we’re here, we’re realizing that we have to deal with a lot of things we hadn’t thought about before. It’s a good reminder that even when you think you know everything about a country, there’s always more to learn.

  63. As a US citizen living in Canada, I always dreaded tax season. It meant trying to navigate the complex and often confusing process of filing my US taxes while living abroad. This year, I thought I had everything under control. I gathered all my necessary documents and sat down at my computer, ready to file my return.

    But as I started working through the forms, I quickly realized I had made a big mistake. I had forgotten to fill out form 1116, which is required for claiming a foreign tax credit. Without this form, my entire return was incomplete.

    I frantically searched online for instructions on how to fix my mistake, but it was too late. The deadline for filing had already passed, and I was facing a hefty penalty for failing to file on time.

    I wasn’t done making mistakes, either. As I continued to work through my return, I realized I had also forgotten to fill out form 2555, which is required for claiming the foreign earned income exclusion. Without this form, I was facing even more penalties and potential issues with the IRS.

    To make matters worse, I had also forgotten to do form 8621 for my Canadian mutual funds. This was a critical mistake, as I had invested heavily in these funds and was now facing even more complications with my taxes.

    In the end, my attempt at filing my US taxes was a complete disaster. I ended up having to hire a professional to help me sort out the mess I had made, and I ended up paying a lot more in penalties and fees than I had originally anticipated. It was a costly and stressful lesson, but one that I won’t forget anytime soon.

  64. Hi Phil, thank you for this write up. I appreciate your efforts at outlining the process and documents involved. My son moved to CA mid-2022 for a job, so will need to file taxes for both US and CA this year. His return is fairly straight forward: US: a little passive income, ~6 months of wages (w/ withholding), assets probably below CA threshold for reporting. CA: wages ~6 months, checking acct probably below US threshold for reporting. Can you let me know via email what you charge for both returns, fbar if required, and any other related tasks? – Thanks.

  65. Hi Phil, I stumbled upon your blog while researching how to file US tax returns in Canada, and I was hoping you could provide some clarity on the process. I am an American citizen living in Canada, and I have several investments in both countries. I am wondering if there are any specific forms I need to file with the IRS or CRA to properly report these investments and avoid any penalties. Additionally, are there any tax implications that I should be aware of when it comes to cross-border investments?

  66. Hey Phil, thanks for sharing your insights on cross-border tax and investments. As a fellow American living in Canada, I have been struggling to understand how to report my income and investments correctly to both the IRS and CRA. One question I have is whether I need to file a Canadian tax return if I am already filing a US tax return. Do I need to report my Canadian income to the IRS or just the CRA?

  67. Hi Phil, I appreciate the information you provided on how to file US tax returns in Canada. I was wondering if you could give some more specific advice on how to handle my RRSP contributions as a US citizen. I understand that contributions to an RRSP are tax-deductible in Canada, but are they also tax-deductible in the US? Do I need to report my RRSP contributions on my US tax return, and if so, how do I do that?

  68. Hi Phil, thanks for the informative article on cross-border tax and investments. I have a question regarding the Foreign Tax Credit (FTC) and how it applies to Americans living in Canada. I understand that the FTC is designed to prevent double taxation on foreign income, but I’m not sure how to properly claim it on my US tax return. Can you explain the process for claiming the FTC and any restrictions that may apply to Americans living in Canada?

  69. I am an American citizen living in Canada, and I have been considering investing in a Canadian mutual fund. However, I am concerned about the tax implications of investing in a foreign fund. Can you provide some guidance on how to properly report my mutual fund investments on my US tax return and whether there are any additional taxes or penalties I should be aware of?

  70. Hello Phil, your help much appreciated.

    Wife and I are US citizens moved to Canada in July 2022. We have US mutual funds (non-retirements) think need to be reported on T1135 as foreign properties. The maximum cost amount refers to the cumulative cost basis of the mutual funds? We need to use the historic exchange rates (from BoC) to convert each lot to CAD?

    Also, gross income refers to the distributions from the US mutual funds? And how do we report the distributions (not from sales, but dividends and capital gains from 1099-DIV)? Do we report them as gross income on T1135, or line 12100 as foreign investment income on T1, or both?

    Many thanks. Much appreciated.


  71. Hello Phil,
    I have been following your tax articles for quite some time. I have noticed that those are really informative and written in very simple way so any reader can understand without knowing some tax related legal terminology.
    I appreciate if you can answer some questions related to dividends.
    I have substantial amount of dividends from Canadian companies. I am citizen tax resident of Canada. I got T5 slips from my discount broker. Now I have file US returns also because I have green Card. All the dividends from Canadian companies also meet IRS requirements for qualified dividends (such as 60 days holding period etc.). My broker has not given me 1099-DIV as I forgot to update my discount broker profile as US Person.
    So is it acceptable to IRS if I do manual calculations and provide summary sheets for qualified dividends and non-qualified dividends? OR you advice to report all dividends as ordinary income.
    I have dividend from my own Canadian corporation (CCCPC), which is also CFC (Controlled foreign Corporation) for IRS. Some articles mentioned that dividend from CFC is qualified dividend for IRS if not previously taxed. Where should I report this without any US tax slips? (I have T5 from my own corporation)

    Thanks in advance for your reply.


  72. Hi Phil,

    I am an American citizen and a new Canadian permanent resident (writing to you from Victoria). I am subscribed to your YouTube channel and am a member of the Americans Living in Canada Facebook group. When we get closer to tax season, I am very much interested in recruiting your assistance with filing tax returns in US/Canada.

    Our family (me, wife, and daughter) is based in Corvallis, Oregon where we own a home. We started our Express Entry application for Canadian permanent residency in 2019 while living in Texas and were accepted/invited in the middle of 2021. In December 2021, we all did a soft landing in Windsor, Ontario to activate our PR status during the pandemic. We stayed in Canada for two weeks and then returned to the States.

    In order to maintain our immigration status, we are aware that we need to be physically present in Canada for two years (730 days) to keep the PR or three years (1,095 days) to qualify for citizenship. Our five-year PR clocks expire on December 5, 2026. We discussed this as a family and, realizing that we would need to spend about 50% of the remaining term in Canada to keep the PR a possibility (or 85% of the remaining term to meet citizenship before the PR window closes), we decided that I would get going with counting some days in Canada. Rachel and Charlotte would stay back in Oregon for the year while I try things out. We will reevaluate the situation next summer to see if I will continue up here and/or if they’re going to join me in Canada (there would still barely be enough days remaining for them to keep their PR and I’d be close to citizenship qualification if we decide to be here through 2026).

    On August 1st, I began a one-year lease of a one-bedroom basement apartment in the subdivision. I imported my vehicle, applied for a BC driver license / health card, and created accounts at Vancity credit union. I work remotely and perform contract work as a business/data analyst for a US company. Up until now, this arrangement has been through my own limited liability company, which I started in 2013 and registered as a foreign entity in Oregon when we moved there in Spring 2022. The LLC in USD through direct deposit to a Texas bank account and issues me a 1099 each year. I pay estimated federal taxes and state taxes to Oregon, and I also contribute to a Solo 401(k) and an HSA.

    Now that I’m physically working from British Columbia, I am curious about a few things.

    – What business structure makes sense for me as I’m testing the waters? I’m not sure, but I think my options are Sole Proprietorship, Corporation, or registering as an extra provincial LLC. I would like to be able to make similar business/operating deductions as I have been doing in the States.

    – Is there anything that I need to have MBI Solutions handle differently? As I said, they pay me as a subcontractor in USD to an American bank.

    – Will I be able to continue to make contributions to my Solo 401(k)? I have seen some websites that indicate this is still viable for US expat contractors.

    – I have already paid estimated Q1, Q2, and Q3 taxes to the IRS/Oregon. I’m unsure how to handle Q4 now that I’m working 80-90% of my time from BC (only a small pct now when I’m visiting the family in Oregon).

    – For the 2023 tax year, I will have more than 183 days based in the US, so this transition year is confusing regarding my residency. I’m definitely trying to demonstrate commitment to Canada/BC in case it eventually leads toward a pursuit of citizenship, but I still have spouse/dependent and real property back in Oregon.

    – I file tax returns jointly to the IRS, but my understanding is that Canada doesn’t have joint returns. Even though have Canadian PR status, they are still living in Oregon, so I wouldn’t think they would have Canadian returns unless they join me up north.

    There may be other aspects that I’m not even thinking about, that, given your experience, would be obvious to you. Some of these things are probably not as important until we reach tax return season, but if you could help set me on the right path now with how I should be conducting business and if there are some things I can do now to avoid surprises in a few months, that would be amazing.

    Thanks in advance and I’m looking forward to working with you,

  73. Phil,

    CRA has asked me to file a RC686. It is mostly straightforward, but with a few tricky questions for Americans (for example: ” Do you have to pay income tax in another country on your world income?”). Would you consider adding Form RC686 to your list?




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