The start season of the return trip to the Quebec glaciers may be postponed, and this delay could cause tax harassment for some retirees who emigrated.
Reasons for delay? Boundary measures imposed by Ottawa to slow the spread of COVID-19.
Passengers entering the country by air will be forced to isolate a hotel at their own expense, which is a $ 2,000 note. Across the road, Quebecans across the border have to present the results of a screening test carried out over the past three days, although activities are less restrictive.
It is not known how long these obligations will last, but they may be encouraged until skiing birds are eliminated from staying south.
By staying in the United States for long periods of time, some icebergs can transfer their income to the U.S. tax authorities, the IRS.
You should know that a Quebec living in the United States beyond a certain period of time becomes an American “financial” citizen in the eyes of the IRS. For an avalanche in this situation, this does not mean paying taxes in the United States, but it does require submitting forms to U.S. tax authorities for exemption.
Quebecs who emigrated to Florida during the winter for many years were well acquainted with these customs. Complying with them is usually straightforward, but sometimes it gets complicated.
According to Martin Caron, senior director and tax expert on international movement at Raymond Sabot Grand Thornton, it all depends on the number of days spent in the United States.
“When a person stays on American soil for a long period of time or is made several times a year, he or she can become a U.S. resident. This is the case when he or she stays in the United States for more than 183 days,” he explains.
But in what period? Two scenarios are possible. If we do not reach the popular number in the same year, we will add 1/3 of the number that stayed on American soil in the previous year and 1/6 of the days spent in the United States two years ago.
If a Quebecker reaches 183 days in the three years of the calculation (not forgetting the small escapes he made in Vermont in the summer), he must fill out a form (8840) which certifies that he maintains a close relationship with Canada and pays his taxes there. Then he doesn’t have to file for US taxation.
If he accumulates 183 days in the same year, that’s a different matter.
He must make a U.S. Immigration Notice (Form 1040-NR) in order to take advantage of the Canada / United States tax treaty and be considered a Canadian tax deductible citizen (8833). The U.S. pays taxes on its Canadian income, ”explains Martin Caron.
The problem here, the expert points out, is that our Quebec has to declare the bulk of its assets, which can become a source of stress, especially if he runs a small business. We leave the neighbor’s skills to master the tax software.
Managing paperwork and related costs can add up to all the problems a blizzard can face when returning home from an epidemic. We do not take into account the additional costs of health insurance.
As the saying goes: between the two evils, you have to choose less. But it is not always easy.