Tax Return for Canadian working in US?

hello all,

My husband got TN and work in US since Mar 2008, I still stay in Canada and have a full time job. There is some questions about both side tax return, can someone to help

For US side,
1, As he is a resident of Canada, even if he stays at US more than 183 days, he still can be a non – resident alien. Is that right? He use the form 1040 NR, but which one should be attached together to claim he is a resident of Canada, 8840 or 8833 ?

2, For me, do I need to apply ITIN which can let him get more deduction? Or he just fills as single?
For my opinion, if he gets more deduction and pay less tax for US, he need pay more extra tax in Canada as the income tax rates are higher usually. So he does not need so much deduction ( such as moving expense, personal Exemption for me)

For Canada side,
Because I still stay here and we have a house in Canada, my husband should be a resident of Canada. My question is about RRSP. He has much RRSP room from previous year, can he buy much RRSP to deduct the income from US or only for the income of Canada?

Thanks

1) Depends on how long he's been in the US, you can use 8833 in any situation but if he's been there for less than 183 days, 8840 is a simpler form to fill in. 8833 is a tricky form to fill in, call the IRS non-resident dept. in PA;
2) You're right I'm not sure it would help because all that would happen is that you'd end up claiming a smaller foreign tax credit for the tax paid in the US but at the end of the day the total amount of tax you would pay would probably be the same because you would be filing jointly in Canada and the rates are higher. Might be worth filing jointly though in the US in case you ever end up moving there, file a W-7 with the 1040NR and request an ITIN;
3) It doesn't really matter because he'll be claiming a foreign tax credit on your T1 and the tax rate will end up being the Canadian one. He ends up getting the RRSP contribution amount based on what his total income in Canada is, including the US-source income.

Thanks, Steve
So for 1),he has been in US more than 183 days, can he use the form 8840? Or he must use 8833.

Thanks again

8833.

Got it, thanks

Steve:

What if someone dont want to report CRA their world income as it will put them into high bracket and since they have already paid taxes in USA

Canadian Rasident for 2008 who work 9 months earning in Canada and 3 month earning in USA

and from 2009 just pay US taxes as non resident..

Well that would be illegal. If you were in Canada for nine months working last year you have no choice but to file as a resident and you cannot file as a non-resident in the US without filing as a resident in Canada.

If you don't want to pay Canadian income taxes, you have to move your tax home to the US, i.e. file as a US resident. Frankly most people do this if they move to the US but in the situation discussed above it's impossible because his wife lives in Canada and he has substantial ties to Canada.