Friday, September 20, 2013

Cross-border Banking & US Taxes


For anyone who spends time in the US, it's great to be able to go to an ATM machine and take out US cash if you run short.  However, if you spend several months at a time, banking fees and charges for money exchange can really add up.  The Toronto Star recently ran an article on the options for US bank accounts versus a Canadian account in US funds and the same options for credit cards.  Which one is right for you?
The article also discusses buying property in the US.  Check it out.
Just remember, you must keep track of the amount of time that you spend in the US, or you could end up having to pay US income and / or estate taxes.  Check out the US IRS web site for the calculation of the Substantial Presence test as well as the exemptions.  If you own property or other assets in the US, you may have other tax obligations. Please check with an accountant who specializes in this area.

Addendum: Dec. 12, 2013 - Check out this article for a simple explanation of when a Canadian would be considered a resident by the US for US tax purposes.

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