Are you one of the lucky Canadians who choose to spend the dreary winter months in the USA? Do you consider yourself to be a snowbird?
Did you know that there are limitations on the number of days you may stay in the USA?
Did you know that your extended stays in the USA may have tax implications over the border?
Did you know that you may be required to file a special declaration called the Closer Connection Exemption Statement (form 8840) to be exempt from paying taxes in the USA?
To determine whether you must file this declaration, you must add up the number of days (or part days) you spent in the USA in 2015 plus one-third the number of days spent in 2014 and one-sixth the number of days spent in 2013. If this calculation adds up to 183 or more days and you were in the USA more than 30 days in 2015, you may be considered to be a US resident for tax purposes under US domestic tax law.
If you make frequent visits to the USA or if your visits are for extended periods of time, we advise you to look carefully at your travel to the USA. You want to be proactive and do this calculation annually and inform your accounting professional when you file your personal tax return. Note that in the past each country couldn’t track the number of days you were in their country as they only saw when you entered their country. Now Canada and the US share your entry dates with each other, so they know exactly how many days you were in their country.
The form 8840 must be filed on or before June 15th and you don’t want to miss the deadline.