|
Posted by sharx35 on February 2, 2007, 1:32 am
Please log in for more thread options
> In general, provided that she did not have a green card
> prior to her immigration on May 1, 2005, under the
> substantial presence rules for determining residency, she
> should be considered to have become a U.S. resident as of
> May 1, 2005. See, e.g., Treas. Reg. 1.7701(b)-4(a)
> (although if she stayed for less than 10 days the first time
> she entered the U.S., went back to Canada, and then came
> back and finally settled in, then her residency starting
> date could be the date on which she finally re-entered for
> good, provided, however, that not more than 10 days of
> actual presence in the U.S. can be excluded from the count.
> See Treas. Reg. 1.7701(b)-4(c)).
>
> Since her U.S. residency most likely began on May 1, 2005,
> her income for the calendar year 2005 would be prorated
> between the period before May 1, 2005 and the period after.
> See Treas. Reg. 1.871-13. With respect to the period before
> May 1, 2005, she would be taxed as a nonresident alien
> individual; i.e., she would, in general, only be taxed on
> her U.S. source income, which in this case is likely to be
> only the U.S. survivor's benefit. However, for that period
> there may be a treaty benefit that would permit her to
> exclude that amount from her U.S. source income; you'll have
> to take a look at the U.S./Canada income tax and social
> security treaties.
>
> For May 1 2005 and after, she would be taxed as a U.S.
> resident; i.e., on all of her world-wide income, which would
> include all of the items you identified above.
>
> With respect to return filing status, unless your client and
> her husband elect to have her treated as a U.S. resident for
> the entire year under Treas. Reg. 1.6013-7, they cannot file
> a joint return for any part of 2005. See Treas. Reg.
> 1.6013-1(b). If that election is made, then all of her
> income for the entire year of 2005 is taxed in the U.S.;
> however, she would then qualify, as a general matter, for a
> foreign tax credit for the taxes she paid to Canada on the
> same income.
Thanks for taking the time to reply. And I thought that our
Canadian tax laws were complicated!
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
| 
Yahoo! 
Google 
Windows Live 
del.icio.us 
digg 
Netscape 
XML Sitemap