TN-1 Visa question, can't find my answer in previous posts.

[Regnier]

My husband and I are Canadian citizens living in the US since November 2007. We own a home in the US, have US driver's licenses, US healthcare, and have paid taxes as a resident as we have been here for over 183 days in the 2008 tax year.

I'm confused as to what I have to do for Canadian 2008 taxes. We own a home in Canada (no one lives there, we simply pay for the mortgage) and have sold it effective June 2009. My US income has never left the US. I have never bothered to cancel AB healthcare as it was free this year (but my son does not have it). I received the 100/month child tax benefits and was on EI Mat leave for 6 mos of the 2008 year. I realize I have to file Canadian income tax for 2008 (EI-mat leave and child tax benefits) for myself. My US earned income has never left the US, so I am not sure what I have to use as an exchange rate? My husband's US income has never left the US either.

Is it mandatory to include my US income under the TN-1 visa job?

I have a US tax bill and now if I do include it, it appears the Canadian gov't wants another 15% on top of what I've already paid in the US.

I'm hoping I'm missing something and just have to declare my CAD income, but don't want to do anything illegal.

Any advise would be greatly appreciated!

-- Sun Apr 12, 2009 5:11 pm --

[samdonowa]

u should call the international tax division of rev canada..

[Steven]

If you filed as a resident for 2008 on 1040, you need to immediately sever any residential ties you have to Canada and if you received any resident benefits from Canada, you need to tell them they made a mistake and refund them. If the CRA deems you resident then you have a problem and they will if they find out you still have AHCIP or are receiving EI benefits.

The only other way of doing it is to file as a US non-resident for the whole of 2008 (which you can do, the substantial presence test can be avoided by making a treaty claim on 8833) and a resident of Canada for the whole of 2008, but if you do that you will owe a heap of Canadian income tax most likely on top of the US income.

Read IRS publication 519.