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