US Citizens Thread

[northern sunshine]

This thread is dedicated to my "fellow Americans" applying for permanent residence in Canada. Whether you've moved, are in the process of moving, or are planning to move in the future, being a US citizen can present unique challenges (and sometimes benefits) in Canada, and this is a place to connect with others in the same boat.

Some examples of topics we might discuss:

1. Which stream did you use/are you using?
2. Why move to Canada?
3. Challenges of moving and becoming "Canadian"
4. Experiences abroad
5. Passport requests/"ready for visa"
6. Logistics of moving
7. Importing/exporting vehicles and goods from the US to Canada
8. Managing finances abroad (and FATCA, GILTI, etc.)
9. Moving funds across the border
   
10. Tax filing and reporting requirements for US citizens in Canada
11. Visiting family in the states and getting your family to visit you
12. Benefits and drawbacks of renouncing citizenship

To get you started, here are some links I've compiled:

Moving to Canada:

IRCC - Crossing the border: documents you need
UPack - Tips on moving from the US to Canada

Importing a vehicle:

Registrar of Imported Vehicles
Transport Canada - Importing a Vehicle
Transport Canada - Importing vehicles purchased in the United States
Travel.gc.ca - Importing a Vehicle
US Census Bureau - Exporting Vehicles to Canada

Ontario - Exchange an out-of-province driver's licence
BC - Moving from Outside Canada
Alberta - Exchange a license from outside Alberta

Filing Taxes Abroad:

IRS - FAQs About International Individual Tax Matters
IRS - Filing with a Nonresident Alien Spouse
Taxes for Expats - Simple Tax Guide for Americans in Canada
Canada.ca - Newcomers to Canada (immigrants)
Greenback Expat Tax Services - A Guide to Filing US Taxes as an American Living in Canada

Finances:

Canada.ca - Opening a Bank Account in Canada

Advisor.ca - How to bring 401(k)s and IRAs to Canada
CardinalPoint - Options for US IRA account holders when living in Canada
Investopedia - The Tax Implications of Opening a Foreign Bank Account
KVDB - US Citizens and Canadian Tax Free Savings Accounts (TFSA)
Moneysense.ca - Investing tips for dual citizens of Canada and the US
TE Wealth - Critical tax issues for Americans investing in Canada

Exchange services:

Transferwise (good for smaller amounts - PM me for a referral link )
Knightsbridge FX (good for larger amounts)
Norbert's Gambit

Connections and Resources:

American Citizens Abroad
Democrats Abroad
Republicans Overseas

Settlement.org
IRCC - Newcomer services

Trumprefugee's blog

 

[USProgrammer]

Thank you for putting this together. I'm very, very concerned about cross-border investments. I have a lot of US investments, and I'm not sure how I'll be able to continue investing on the other side of the border. Everything I have is with Vanguard currently.

 

[northern sunshine]

Thank you for putting this together. I'm very, very concerned about cross-border investments. I have a lot of US investments, and I'm not sure how I'll be able to continue investing on the other side of the border. Everything I have is with Vanguard currently.

Investing while in Canada is the one thing I've had a very hard time wrapping my head around. That is probably a symptom of being new to investing in general, but I would love something that clearly and concisely lays out what you can/cannot do without tax repercussions.

Here's another link to throw into the mix, I guess:
Moneysense.ca - Investing tips for dual citizens of Canada and the US

 

[derkdsou]

Wow, @northern sunshine, bravo! I'll start out by saying that while I'm not a US citizen, I did spend eight (formative) years of my life there and I find many things here overlap with my experience moving to Canada. For example, I have investments with Vanguard and TRowePrice, and I continue to file taxes in the US for this reason. And I have a 401(k), which I might finally want to do something about. I will be keeping an eye on this forum and be sure to limit my comments to matters that concern the target audience, i.e., US citizens.

P.S. I have a good (former) American friend who moved to Australia and later renounced his US citizenship. Let me know if you would like to hear from him on this subject!

Thank you for putting this together. I'm very, very concerned about cross-border investments. I have a lot of US investments, and I'm not sure how I'll be able to continue investing on the other side of the border. Everything I have is with Vanguard currently.

 

[USProgrammer]

When do we all meet up with our lifted pickups with (empty) gunracks painted with bald eagles and American flags? And truck nuts, of course.

Edit: Sarcasm/making fun of US stereotypes, of course. I realized some here may not have interacted with me before, so I figured I'd better clarify on a first-page response in this thread for future readers.

 

[northern sunshine]

When do we all meet up with our lifted pickups with (empty) gunracks painted with bald eagles and American flags? And truck nuts, of course.

Ah, home, sweet home... I'll bring the hot dogs and a case of bud light. Maybe these boots I've been eyeing, too.

That said, this is almost exactly how rural Canada has been described to me, just with a little more flannel. If you haven't yet, watch Letterkenny!

 

[TheDude2287]

This is great. I married a Canadian and due to family issues we decided it was easier for me to move to Canada. I just got officially approved an hour ago and still have so many questions I can't wait to dive into the links posted. Thanks again.

 

[northern sunshine]

This is great. I married a Canadian and due to family issues we decided it was easier for me to move to Canada. I just got officially approved an hour ago and still have so many questions I can't wait to dive into the links posted. Thanks again.

Ah that's wonderful, congratulations! I am in a similar situation-- not married, but my SO and I decided it was easier for me to go to Canada than vice versa. I am planning on moving later this year. There's so much ground to cover; it's taken me over a year to compile these resources and I'm still by no means done. Can't wait for tax season!

 

[northern sunshine]

Someone in one of the groups I'm in posted that it cost them $2200 CAD to get their taxes sorted for their first year. US federal & state + Canada federal & provincial.

 

[macarson]

Guess I'll throw my hat in the ring here.

I moved to Canada in Jan. 2014 to study, got a post grad work permit a year ago, and have my PR landing interview on this coming Tuesday (common-law with a Canadian citizen so hit me up if you have questions about that).

I'm pretty sure my car things are all messed up, I "imported" it (paid CAD federal taxes on the value of the car) but as a temporary resident so I'm not really sure if anything changes now that I'm not a student and will have PR (I supposedly could get the import tax money back if I ever took it back to the US). I have insurance and have gotten it registered in Ontario and Alberta with no problems so guess it's not a problem, haha.

Seems like the other main topic so far is investments and taxes. I did my own taxes the first three years and had no issues, but I unintentionally messed up and put money into a TFSA (it's so tempting). DO NOT DO that. The US considers these foreign trusts and you have to file extra US tax paperwork, I think it only really pays off if you have a lot of money held here but I still haven't figured that out, or had the funds. Had that sorted out last year for a cool $800 and I'm planning on filing my US taxes myself again this year.

Taxes cont.: Canadian taxes are fairly easy and straight forward. US are also fairly easy if you don't have a lot going on. Under something like $105,000 USD you can file an exemption that basically puts everything at $0, over that amount and you have to file a income tax % which basically shows you are paying more % tax in Canada than you would in the US, if not you pay the difference to the US.

Make sure you also file an FBAR every year if you have over $10k held in foreign accounts.

Investments/banking: This took me a long time to figure out and I'm still working on the details. From what I've experienced the "safest" place for your money in Canada is an RRSP as the US recognizes this as essentially a 401K and doesn't bother with it (aside from any "income tax" it might generate when you retire, but that would likely be under the annual exclusion limit unless you do really well in the markets). I also have stocks both US and Canadian so I file my US holdings on Canadian taxes and Canadian holdings on US. Sorta dumb but I'm pretty sure when you realize these and need to pay taxes on the gains you just do it in whatever country they were held in (haven't done this yet so not totally sure). I think all either country really cares about is that you pay tax somewhere. I also have a RothIRA in the US which was initially a pain in the ass to manage as you need a cross boarder company to manage it. A US based/licensed person cannot legally move that money around even if you are physically present in the US with them (go figure).

Right now I am with Raymond James who holds all of my investments. I have one advisor who can manage all of my holdings in both countries. They have a US side that holds my rothIRA and a Canadian side which holds my RRSP and stocks. PM me if you want more details or contacts.

I am with RBC for banking and they have a similar setup with US based banks so I can hold both US and Canadian accounts and manage them from here. My Canadian accounts even has a US savings account in USD. It is really easy to move money across the border this way and the exchange rate gets better the more you move at once.

 

[canuck78]

Someone in one of the groups I'm in posted that it cost them $2200 CAD to get their taxes sorted for their first year. US federal & state + Canada federal & provincial.

All depends on what kind of assets they are dealing with. Also could involve a business too. It's all relative so you can't really compare.

 

[APPNOV2014NY]

I'm pretty sure my car things are all messed up, I "imported" it (paid CAD federal taxes on the value of the car) but as a temporary resident so I'm not really sure if anything changes now that I'm not a student and will have PR (I supposedly could get the import tax money back if I ever took it back to the US). I have insurance and have gotten it registered in Ontario and Alberta with no problems so guess it's not a problem, haha.

Temporary residents like Students and Work Permit holders are allowed to temporarily import car for the duration of their visa. Once visa is over they need to take car with them outside of Canada. Most probably you temporarily imported car in 2014 and will need to take it to USA and then "permanently" import it as a PR else you won't be able to sell this car in Canada. You will also need to submit Goods to follow at the time of your landing so that you can import your car duty free.

 

[northern sunshine]

Taxes cont.: Canadian taxes are fairly easy and straight forward. US are also fairly easy if you don't have a lot going on. Under something like $105,000 USD you can file an exemption that basically puts everything at $0, over that amount and you have to file a income tax % which basically shows you are paying more % tax in Canada than you would in the US, if not you pay the difference to the US.

Make sure you also file an FBAR every year if you have over $10k held in foreign accounts.

Investments/banking: This took me a long time to figure out and I'm still working on the details. From what I've experienced the "safest" place for your money in Canada is an RRSP as the US recognizes this as essentially a 401K and doesn't bother with it (aside from any "income tax" it might generate when you retire, but that would likely be under the annual exclusion limit unless you do really well in the markets). I also have stocks both US and Canadian so I file my US holdings on Canadian taxes and Canadian holdings on US. Sorta dumb but I'm pretty sure when you realize these and need to pay taxes on the gains you just do it in whatever country they were held in (haven't done this yet so not totally sure). I think all either country really cares about is that you pay tax somewhere. I also have a RothIRA in the US which was initially a pain in the ass to manage as you need a cross boarder company to manage it. A US based/licensed person cannot legally move that money around even if you are physically present in the US with them (go figure).

Thanks for sharing!

Do you still have any interest-generating accounts in the US? I want to leave my bank accounts open but I'm unclear on how manageable that is when it comes to tax time, since the interest is technically US-based income. I suspect in this case it may be better to file FTC rather than FEIE.

Curious to hear how others manage their investments that are still based in the US as well. I intend to roll my 401k into IRAs and just leave it alone. I know others have chosen to bring their savings with them in entirety to Canada.

 

[northern sunshine]

What is the total amount of interest you receive annually? Treat it like how you would as if you were present in the US. I have very significant holdings in my savings and interest bearing checking accounts in the US and not much has changed for me. I still file taxes based on what income I receive period the same way I would as if I was present in the US. I have several rental properties too so I have a lot of write-offs. I don't report such income in Canada because when I was buying my house the bank would not consider it because it was foreign income. I just put a 40% down payment to avoid paying that ridiculously high mortgage insurance and to get my loan approved with less scrutiny. For $15 I use the olt site to do my taxes: not the $2200 some claims it costs to do US taxes. Its very simple all you need to do is plug the numbers in just have your most previous tax returns to use as a guide and you will be good. Also when I need to move money to Canada I just simply write myself a check and deposit in my Scotia Bank account and that costs me nothing and I have access to my money instantly. They stop holding funds my my checks recently.

A few hundred in interest probably, not a ton but not nothing. I'm not that advanced in my finances, just wondering about taking advantage of FTC vs FEIE. I'll have regular income from Canada but interest from the US.