Kotler van den Brink & Company   

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   U.S. & Cross Border Tax Consultants

 

 

 

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Contact Information.

A description of the services provided by KVDB.

Employment opportunities with Kotler van den Brink & Company

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The U.S.TAXFAX is a newsletter published by our firm covering various topics relating to U.S. and cross-border tax matters.

This PDF document discusses how non residents recover U.S. taxes withheld on gambling winnings.

Canada - U.S. exchange rates from 1990 onwards.

Information on how a U.S. non resident obtains a U.S. ID number.

This is a W-7 form and instructions in PDF format. It is a fillable form.

 

A U.S. citizen residing in Canada must file U.S. and Canadian income tax returns every year.  The U.S. return is the same return used by residents living in the United States.  Many U.S. citizens (and their Canadian tax practitioners) are not aware of the pitfalls and requirements of being a U.S. citizen living in Canada.  In order to complete the U.S. return correctly, and quite often the Canadian return as well, a detailed understanding of the Canada- U.S. Tax Convention of 1980 (The Treaty) is required. 

We have also noticed an ever increasing number of situations where a U.S. citizen undertakes a strategy to minimize Canadian taxes without considering the U.S. tax consequences of such a plan.  In some cases, the Canadian taxes saved or deferred can be wiped out by the increase in U.S. taxes.   

Areas of concern that we have noticed over the years include the following:

U.S. Income Tax Returns:

bulletItems of income are not reported on the U.S. return correctly such as Canada Pension Plan payments, RRSP withdrawals, and/or distributions from Canadian trusts. 
bulletForeign tax credits are calculated incorrectly and the benefits of carrying forward these credits are not considered. 
bulletThe impact that The Treaty has on the foreign tax credits claimed is not considered. 
bulletU.S. Alternative Minimum Tax (AMT) is not considered.  AMT can apply to many U.S. citizens living in Canada.
bulletThe tax consequences and compliance requirements of establishing and maintaining a Canadian trust with U.S. citizen beneficiaries and/or settlor(s) are not considered.  
bulletThe tax consequences and compliance requirements associated with a U.S. citizen owning a Canadian corporation are not considered.
bulletAvailable deductions are not taken such as the foreign earned income exclusion.
bulletElections that can minimize taxes payable are not made
bulletCanadian RRSP's are accounted for incorrectly.
bulletU.S. self employment taxes are dealt with incorrectly.

Canadian Income Tax Returns:

bulletForeign tax credits are calculated incorrectly.
bulletItems of U.S. source income are accounted for incorrectly such as distributions from U.S. mutual funds, pension plan payments, and/or the sale of assets located in the United States.

This topic is discussed in more detail in the following U.S.TAXFAXs:

 
bulletU.S. citizens living in Canada
bulletEstate tax for U.S. citizens living in Canada
bulletTax Traps for the unwary
bulletRecent Developments in U.S. and cross-border tax