Taxes/Payroll - Working in US/ Living in Windsor

[seamarine]

I think that rrsp contribution should be enough if one has at least total 2 dependents - at least this is the case for me though.
Check if you missed to include any taxes. I include taxes paid in US as the sum of federal, social security, medicare and state tax.
Also the income i report in Canada is the Adjusted Gross Income.

Hello

Any recommendations on who to use to file US and Canadian taxes?

Thanks

 

[harirajmohan]

Hello

Any recommendations on who to use to file US and Canadian taxes?

Thanks

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).

 

[canuck78]

Wanted comment since someone suggested trying out Canadian healthcare before signing up for your US plan. You will spend the majority of your waking hours during the week in the US. You will also be driving a car almost daily in the US. If you can afford to get into a car accident in the US and pay off any medical debt then don't get insurance but seems like a huge risk.

 

[canuck78]

Hi,

I am living in Windsor and working in Detroit, and as discussed earlier Canadian tax are higher, is there any way to save tax deduction besides contributing to RRSP...Can we contribute to Canadian pension plan? or is there any other plan is there?

You are already paying a lower tax rate, using Canadian services while your tax payments go to the US and making US dollars... Not sure what kind of contribution limits you have given your US incomes but RRSP and TFSA are the tax sheltering vehicles in Canada.

 

[gtvisa2020]

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).

Couple of questions:
1. Do you deduct refund amount from total taxes paid? I have lived in Canada only for part of the year, and I know exact taxes paid to IRS in those months. But refund is for the whole year, so how do you deduct this? by pro-rating?
2. Could you elaborate on 401k exemption point?

Thank you.

 

[harirajmohan]

Couple of questions:
1. Do you deduct refund amount from total taxes paid?
I have lived in Canada only for part of the year, and I know exact taxes paid to IRS in those months.
But refund is for the whole year, so how do you deduct this? by pro-rating?
2. Could you elaborate on 401k exemption point?
Thank you.

1. During my first year, I specified the date i moved and i think that the software calculates it based on it - i dont know as i trusted the software and filed as it was 0$ tax i had to pay.
Refund: According to my understanding, we should not worry about this amount as taxes are deducted based on the earning and remaining will be refunded hence its not your income. So dont get confused on it. So just report your full year income and the date you moved in and the taxes you paid. Everything is fine as per CRA.
What i include as taxes paid in US: Federal, State, Medicare and Social security taxes.
2. You dont need to do anything for 401k amount deduction. The aggregated income in 1040 is to be reported as US income(which already deducted the 401k amount) but CRA was not allowing me to deduct this amount because i did not send the original W2 or the original statement of amount deposited for 401k from the 401k company/bank.

 

[gtvisa2020]

1. During my first year, I specified the date i moved and i think that the software calculates it based on it - i dont know as i trusted the software and filed as it was 0$ tax i had to pay.
Refund: According to my understanding, we should not worry about this amount as taxes are deducted based on the earning and remaining will be refunded hence its not your income. So dont get confused on it. So just report your full year income and the date you moved in and the taxes you paid. Everything is fine as per CRA.
What i include as taxes paid in US: Federal, State, Medicare and Social security taxes.
2. You dont need to do anything for 401k amount deduction. The aggregated income in 1040 is to be reported as US income(which already deducted the 401k amount) but CRA was not allowing me to deduct this amount because i did not send the original W2 or the original statement of amount deposited for 401k from the 401k company/bank.

This helps, thank you!

 

[pr131985]

Wanted comment since someone suggested trying out Canadian healthcare before signing up for your US plan. You will spend the majority of your waking hours during the week in the US. You will also be driving a car almost daily in the US. If you can afford to get into a car accident in the US and pay off any medical debt then don't get insurance but seems like a huge risk.

Well you can always buy travel insurance to cover for the unwarranted accidental needs, which costs less than 100 per head per year.
One does not need a comprehensive medical insurance for US.

Having said that, depending on how far you work inland in US from the border, in order to see your PCP/GP in Canada you will probably have to take a day off.
Having a US comprehensive insurance can save time. But I would not like to pay thousands of dollars to avoid this inconvenience.

 

[pr131985]

You are already paying a lower tax rate, using Canadian services while your tax payments go to the US and making US dollars... Not sure what kind of contribution limits you have given your US incomes but RRSP and TFSA are the tax sheltering vehicles in Canada.

It's not that by working in US (paying taxes) and staying in Canada (taking services), they are ripping off Canada.
The remaining after tax income they bring to Canada is in USD and helps reduce the trade deficit with US.
That money will be spent in Canada for buying a house, grocery, services etc thus paying salaries to other people which will be taxed.

It's not a loss to Canada, if it was the government would not have agreed to such a treaty; after all, Taxes are used to pay their bills.
Please, don't judge an individual who is trying to save some of his/her hard earned money.

 

[DEEPCUR]

You are already paying a lower tax rate, using Canadian services while your tax payments go to the US and making US dollars... Not sure what kind of contribution limits you have given your US incomes but RRSP and TFSA are the tax sheltering vehicles in Canada.

People need to pay any tax difference to Canada. So they don't pay lower tax rate than others.

By the by, I am pretty sure you don't have any clue on H1b and any of these cross border thing works. I am not sure why you are still hanging around in these threads and providing your opinions and assumptions as facts.

 

[hereicomecanada]

Hello Everyone,

I moved to Canada in November 2018 from USA. I was and still am employed with my US employer. My wife started working in Canada mid November and I know she has to file tax. My question is,

1. do I need to file taxes in Canada (US income) for the 1 and 1/2 month of 2018?
2. If I have to file, what documents other than W2 and the filing papers do I need?
2. Can I file for extension, somewhat similar to the US?

And I live near Surrey, BC. does any one of you know any tax consultants near here?

Thank you

 

[hereicomecanada]

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).

Hello Harirajmohan
I was wondering if you can provide some information/your experience related to filing tax in US and Canada.
I moved to Canada from California in November 2019. I continued to work for my US employer from Canada. I have couple of questions:
- To file US tax online, wait for refund and apply for transcript, I guess would take long. Do we need to have the IRS & State transcripts in hand before filing Canadian tax?
-In my case, I dont know if i have enough time to go through that process. Do you know if we can send the transcripts to cra after the filing deadline in case if we do not receive on time?
-Does the transcripts contain social security and medicare deductions? I guess they are a different agency.
- For the 401K exemption, do we need to request statement from the 401K company?
I appreciate any information you may provide
Thank you

 

[harirajmohan]

Hello Harirajmohan
I was wondering if you can provide some information/your experience related to filing tax in US and Canada.
I moved to Canada from California in November 2019. I continued to work for my US employer from Canada. I have couple of questions:
1. To file US tax online, wait for refund and apply for transcript, I guess would take long.
2. Do we need to have the IRS & State transcripts in hand before filing Canadian tax?
In my case, I dont know if i have enough time to go through that process.
3. Do you know if we can send the transcripts to cra after the filing deadline in case if we do not receive on time?
4. Does the transcripts contain social security and medicare deductions? I guess they are a different agency.
5. For the 401K exemption, do we need to request statement from the 401K company?
I appreciate any information you may provide
Thank you

1. File US return. Check the tax amount you need to pay in Canadian tax sites such as ufile.ca/simpletax.ca. For first year, you might not be owing anything as you are resident for just 2 months. If owing 0, then submit tax return for Canada. Mostly for first year there wont be any audit.
2. its fine. YOu can file and they will ask for more document if required. its not mandatory to send the additional documents during the filing.
3. Yes but after they ask for it. Not everyone is audited. They will send a letter asking for it.
4. W2 will have that hence thats enough.
5. I am yet to see which document they accept as i did not send the original w2(or 401k account deposits). They asked like "You did not send us an official receipt or a copy of information slip". I assume that the statement of deposit from 401k site is enough but not sure. I am still researching and experimenting on it. I will know this year if they accept the original w2 and copy of 401k account deposits which i sent last week.

 

[hereicomecanada]

Hello Everyone,

I have been residing in Canada for past 6 months on PR and working for my USA employer (based in California) on H1B remotely from Canada. My question is, does my employer need to deduct all taxes (Federal, Social, Medicare, CA State, CA Disability) even if I am working from outside the country?

Thank you for any inputs.

 

[harirajmohan]

Hello Everyone,

I have been residing in Canada for past 6 months on PR and working for my USA employer (based in California) on H1B remotely from Canada. My question is, does my employer need to deduct all taxes (Federal, Social, Medicare, CA State, CA Disability) even if I am working from outside the country?

Thank you for any inputs.

Yes all state, local and federal - as per my previous situations while i was outside US for months. If not its not an employment and it would be a flat fee for the service you provide as a consultant/company.