Taxes/Payroll - Working in US/ Living in Windsor

[swan0206]

so do you order an online transcript? Print and attach with Canadian tax? Or request them by mail?

If you login to IRS , you should be able to find an option called Get Transripts online. You need to select the reason for your request and then you will be able to download yourself. Then you can go to cra online account and upload there if there was a notice sent(based on the notice number) to you.

ps: I have done this last year when i got a notice from CRA asking to submit IRS transcripts.

 

[neil_user]

so do you order an online transcript? Print and attach with Canadian tax? Or request them by mail?

They need originals, so I request them by mail.

 

[neil_user]

If you login to IRS , you should be able to find an option called Get Transripts online. You need to select the reason for your request and then you will be able to download yourself. Then you can go to cra online account and upload there if there was a notice sent(based on the notice number) to you.

ps: I have done this last year when i got a notice from CRA asking to submit IRS transcripts.

AFAIK IRS login is not available for people with foreign address. In my experience, transcript by mail is pretty quick, they take ~3 weeks to send it.

 

[desmat]

Hi All,
I have a very basic query..
1) Can anyone inform me for the US Canada border commuters (Living in Canada and working in US), if we need to file the 1040 NR or 1040 form for the US tax return?
2) Is there any tax difference among the 1040NR vs 1040?
Thank you!

Obviously if you are tax resident of Canada, then you are Non resident of US (as long as you are not a US citizen or green card holder).
So, being non resident of US, one uses 1040NR form and yes the tax difference is almost double in 1040NR than 1040 because as non resident you don't get deductions of $12000 or $24000 etc. for single or married filing..

 

[desmat]

I use one of the below:
US: olt, turbotax, taxact, taxslayer
Canada: Simpletax, ufile.

You can file online for Canada also but not sure if it works for you.

Filing methods/steps i use to avoid audit from cra: File US online. Wait till refund arrives. Apply for transcript via mail from IRS and State. File Canada one via paper(after including original W2, original transcripts).
Stupid thing what cra does is to ask for these documents in original for many of us(my colleagues) hence we follow this method. Even on 401k exemption i could not get it last year because they wanted all damn documents in original(the ones that were physically mailed to us).

How were you able to get refund from your US tax return?
were you filing 1040NR or 1040 when you got refund?
If 1040NR, did you use form 8833 because of which you got refund?
Otherwise i am confused how can you get refund with 1040NR without form 8833 or with 1040 ?? (unless you overcontributed with your each pay period of US employer)

 

[desmat]

Wait did you not pay any tax to Canada? You do need to pay the difference in tax rates b/w US and Canada to Canada since you would be a resident here. Yes RRSP would save you some taxes, TFSA is after tax contribution.

For ex, you paid 30k taxes to USA and your Canadian liability is 40K, then you would pay the difference of 10K to Canada after claiming 30K of Foreign tax credit.

If your US and Canadian tax rates are the same, then only you wouldn't owe anything to Canada. Since you mentioned BC, this scenario is impossible unless you commute to NYC. I could probably do a better job with your taxes, you should get a decent accountant.

If you are non resident of US, then you file 1040NR and US charges more taxes because you don't get any standard deductions like a resident 1040 filing..
so yes, it is possible that in that case your US and Canadian tax rates will be almost same...

 

[harpreethwalia]

Want to use this thread to put in my scenario here.

I am a Canadian Citizen currently working and living in Canada. I was on H1-B in US for almost 8 yrs (GC Priority date of Sep 2012) before moving to Canada and become Citizen here. I am getting a US job offer (fully remote). The employer is willing to either pay in CAD or USD, whatever I choose.

Few questions

1) Can employer apply my H1B in this situation? (Working for US employer fully remote from Canada)?
2) Better to get paid in USD or CAD?
3) Any specific tax consideration to keep in mind?

 

[zwang303]

Since no-one replied, let me take first crack on this one. In 2015, I paid US taxes as non-resident and Canadian ones as resident. In 2016, I paid US taxes as resident and Canadian ones as non-resident.

1. Your US employer cannot deduct Canadian taxes if you are on US payroll. They will deduct US taxes. At the time of taxes filing, you will first file US returns as non-resident and once done you will file Canadian returns as resident. In Canadian taxes you will take credit for the taxes paid in USA, so you won't be double taxed.

Let's say you made 100k in US, your US taxes are 20k and Canadian taxes are 30k. You will pay 20k to US and then pay difference to Canada ( 30-20k = 10k).

2. No. You don't.

3. As a US non-resident, I don't think 401k and HSA would be available to you.

Question on 3: a Canadian PR is a Canadian tax resident for sure. US employers deduct US tax so H1b holders have paid US tax already through the year, so they will use that as tax credit to file Canadian tax. But one thing confuses me: if companies know an H1b holder is a Canadian PR and sign them up with Canadian health, and retirement benefits instead of 401k, why would they keep them on Canadian payrolls instead of relocating them to Canada completely? Obviously Canada has lower pay than US in the tech industry.

 

[zwang303]

I am in the same boat than you, i will be watching this thread. By the way do you have any suggestion for good apartments in windsor close to the border l have to go to work in Pontiac.

Hello,

I actually have an interesting question to ask: does your employer give you Canadian healthcare benefits or US? I wonder why would they allow someone who works in the US (pay in USD) to receive Canadian insurance, etc? That means to me companies know you are a Canadian PR already, so why don't they put you on the Canadian payroll as all other regular Canadian employees?

Thank you!

 

[zwang303]

Hello - I am trying to understand the impact of working in Detroit area while living in Windsor,Lasalle area. I am a new Canada PR holder with H1B visa in US.

1) Taxes - My employer will be paying me as an employee of US. Will I just pay Canada taxes end of the year? or should I ask my employer to deduct Canada taxes?

2) Housing - Since my employer will be paying as an US employee, I assume I have to have a residence in Detroit area as well?

3) Medicare/401k/ HSA - Will these continue to be deducted despite living in Canada? if yes, should we paying equivalent of these in Canada as well?

anyone commuting cross border or have such a setup please suggest.

Hello,

I actually have an interesting question to ask: does your employer eventually give you Canadian healthcare benefits or US? I wonder why would they allow someone who works in the US (pay in USD) to receive Canadian insurance, etc? That means to me companies know you are a Canadian PR already, so why don't they put you on the Canadian payroll as all other regular Canadian employees?

Thank you!

 

[zwang303]

Hello,

I actually have an interesting question to ask: does your employer give you Canadian healthcare benefits or US? I wonder why would they allow someone who works in the US (pay in USD) to receive Canadian insurance, etc? That means to me companies know you are a Canadian PR already, so why don't they put you on the Canadian payroll as all other regular Canadian employees?

Thank you!

 

[swan0206]

Hello,

I actually have an interesting question to ask: does your employer give you Canadian healthcare benefits or US? I wonder why would they allow someone who works in the US (pay in USD) to receive Canadian insurance, etc? That means to me companies know you are a Canadian PR already, so why don't they put you on the Canadian payroll as all other regular Canadian employees?

Thank you!

Here you are missing an important point that, few companies that are ok people working remotely from Canada do not change anything, they just leave as everything(like healthcare) for the employees and what the employee does is to file taxes at the end of the year in this fixture. Changing payroll to a Canadian entity is a whole different scenario. Not all US companies might have their Canadian entities to transfer them which is why people mostly remain on their US payrolls and keep continuing what they do.

Also there are many people who are consultants and their firms do not have this setup to turn them onto a Canadian payroll which is obviously tedious procedure even though they want just for few folks and they just allow them to work from Canada which is fine for them without any headache.

 

[zwang303]

Here you are missing an important point that, few companies that are ok people working remotely from Canada do not change anything, they just leave as everything(like healthcare) for the employees and what the employee does is to file taxes at the end of the year in this fixture. Changing payroll to a Canadian entity is a whole different scenario. Not all US companies might have their Canadian entities to transfer them which is why people mostly remain on their US payrolls and keep continuing what they do.

Also there are many people who are consultants and their firms do not have this setup to turn them onto a Canadian payroll which is obviously tedious procedure even though they want just for few folks and they just allow them to work from Canada which is fine for them without any headache.

Thanks for your reply. I currently work for a US company but we have offices in Canada. I'm getting my Canadian PR in a few months and trying to get back to US so I can apply for Green card. So I wonder once I get H1b or L1 visa going back to US, I pretty much become a US employee which means I will have all US benefits (healthcare, 401k), right? Then the only thing is I will live in Canada and file Canadian tax myself correct?

 

[swan0206]

Thanks for your reply. I currently work for a US company but we have offices in Canada. I'm getting my Canadian PR in a few months and trying to get back to US so I can apply for Green card. So I wonder once I get H1b or L1 visa going back to US, I pretty much become a US employee which means I will have all US benefits (healthcare, 401k), right? Then the only thing is I will live in Canada and file Canadian tax myself correct?

You might have to discuss your future work schedule with your employer and see if they will allow you working on US payroll or they would want to transfer you to a Canadian entity. If they are fine you working remotely from Canada then what you mentnioned above holds good. Its something what your employer wants to do with your scenario as they do have offices in Canada.

 

[zwang303]

You might have to discuss your future work schedule with your employer and see if they will allow you working on US payroll or they would want to transfer you to a Canadian entity. If they are fine you working remotely from Canada then what you mentnioned above holds good. Its something what your employer wants to do with your scenario as they do have offices in Canada.

That sounds reasonable. I just don't why other people are allowed to work in the US while being a Canadian PR. Unless their companies don't have entities in Canada? I would imagine companies simplify things by putting their employees on the Canadian payroll if they do live in Canada rather than US payroll. As we all know US usually pays more than Canada.

Maybe the only option is to find a employer who doesn't have Canadian entity at all or just don't mention I'm a Canadian PR when applying H1B with the US company?