Working in the US on a TN and telecommuting to Canada

I'm going to be working in the US under an TN visa for a US employer. Additionally, I'm also considering keeping a consulting job here in Canada, which I can telecommute for. The company is Canadian and I would get paid into a Canadian bank account.

I know it's technically illegal for visitors to telecommute, but I'll no longer be a visitor but have non-immigrant work status. Also I understand that if one is working under a TN, one can technically only work in the US for one's US sponsor company. So I'll be technically working in the US only for my sponsor company, but I'll also technically be working in Canada for a Canadian company. I think my situation falls in the grey area. Is this scenerio legal? Can I keep my Canadian consulting job or will I have to give that up?

Please help....

Why wouldn't it be legal? You're in Canada while you're working for the Canadian company and you'll be filing Canadian taxes. You aren't working for your Canadian company while you're physically in the U.S., although perhaps there is some bizarre American law that says you can't, I've never heard of it.

Sorry, I don't think I was clear...I acutually will be physically in the US while telecommuting to my Canadian job. That's where my understanding of the law is grey.

No it's not legal because you're not authorized to work for that employer in the US, only the one who sponsored you for the TN-1. Plus because you're doing the work in the US, if you're directly employed by them then they would have to do US payroll taxes and have an EIN, or if you're self-employed you would have to register as a self-employed person (or non-resident alien self-employed person) which you can't legally do on TN-1.

Unfortunately the law simply hasn't kept up with technology in this regard, so any method of doing it is sort of awkward. Your current US employer could sub-contract you back to the Canadian employer I suppose, or you could start up your own US business and get an E-2 visa, but E-2 status has its own problems.