An H-1B professional leaves U.S. employment and moves to Ontario in September. They hold a 401(k), Roth IRA, taxable brokerage account, and stock awards from the former employer. The Canadian residency date, U.S. year-end status, asset values, equity income, and future account activity need a coordinated review.
1. When does Canadian tax residency begin?
Canadian income-tax residency is based on residential ties and the full facts, not solely permanent-resident status, a work permit, or the date you cross the border. A treaty analysis may be relevant when both countries consider you resident under domestic rules.
2. What does the first Canadian return cover?
A newcomer return can require worldwide income for the period after Canadian residency begins, plus information about income for other periods where needed for credits or benefit calculations. Province of residence, family information, and foreign reporting should also be considered.
3. Does U.S. filing continue after the move?
It often can. U.S. citizens generally continue to file U.S. returns. Green-card holders and former H-1B or other visa holders need their U.S. tax-residency position reviewed under the green-card test, substantial-presence test, residency-ending rules, elections, and any applicable treaty position.
4. Which arrival-date records should be preserved?
Fair-market values for taxable investments and other property on the Canadian residency date can be important for future Canadian gain or loss calculations. U.S. basis may not change in the same way, so parallel records may be needed.
5. What happens to U.S. retirement and investment accounts?
Keeping, contributing to, converting, transferring, or withdrawing from a 401(k), IRA, Roth account, pension, or brokerage account can produce different results. Account classification and planned transactions should be reviewed before action.
6. Which Canadian and U.S. information reports may apply?
Canadian residents may need to consider Form T1135 for specified foreign property. U.S. filing can also bring FBAR, Form 8938, or other information forms into scope. Ownership, classification, value, and filing status determine the actual requirements.
What to bring to a planning call
- Citizenship, green-card, and visa history
- Canadian housing, family, and work dates
- Income by employer and work location
- Arrival-date account and investment values
- 401(k), IRA, Roth, pension, and equity records
- U.S. real property, business, or state ties