# Confused about filing U.S. and Canada taxes



## lbmiller

My husband, two kids and I moved from the U.S. to Canada in April 2011. My husband worked part the year in the U.S. and the other in Canada. We are in Canada on 3 year temporary work permits. I did not work in the U.S. or Canada in 2011. I consulted with an accountant in Canada who quoted me $1000 to file taxes for us in both countries. This seemed a bit steep. 

Is it possible for us to file it on our own? We are considering getting the U.S. and Canadian versions of Turbo tax and doing it on our own. Will we end up paying double our taxes if we do it this way? Are there other pitfalls we should be aware of?

Any advice we can get will be greatly appreciated! 

Thanks!


----------



## makaloco

I've never used TurboTax and don't know a thing about taxes for Canada, but I've filed US taxes myself since the 1970s, including 33 years working and living abroad. The only time I got help from a professional was for a rather complicated property sale that required several years of amended returns. Unless your situation is unusually complex, you should be okay as long as you have the patience to read through the materials and follow instructions that apply to you. It's rather tedious but not particularly difficult unless you get into foreign trusts, investments, and the like. Start with Publication 54, which you can download from Internal Revenue Service. And good luck!


----------



## lbmiller

Thanks! I'll start reading! I don't think our situation is very complex. We've always done our own taxes. Because we've spent half the year in each country, I just a bit nervous on how to do them. Thanks for the vote of confidence to just forge ahead!


----------



## albator73

Hi,

I'm in the same boat, I just receive a job offer to work from home base in Quebec, Canada required to travel and work 1 week in US. Been U.S. Citizen I must comply with 2 country tax. 

Also Looking for tax software that can help me doing tax in US and Canada.

Thanks


----------



## Vangrrl

I haven't tried it, but apparently Turbotax (US) works fine for Americans abroad. It has the relevant forms (at least 2555 and 1116 and 8891). I was going to give it a try this year. The only thing is you can't efile from abroad so you have to print out the forms and mail them.

Canadian taxes are pretty straightforward to file even with US earned income (and a foreign tax credit). It was years ago when I did this, but I filed it myself.


----------



## Bevdeforges

Although you hear the most about the half of American taxpayers who pay someone to do their taxes, half do them themselves. TurboTax normally should be adequate to prepare your US returns. But in preparation, be sure to read through Publication 54, available for download from the IRS website.

You should also read some of the posts linked from the stickies at the top of the forum page here. For those who moved to Canada (or anywhere else) part way through the year, you may want to wait until you have been outside the US for a full 12 months before you file, in order to take advantage of the foreign earned income exclusion. Publication 54 gives the details about how this works and how to file for your extensions of time to file.
Cheers,
Bev


----------



## lbmiller

Hi Bevdeforges,

Thanks for the advice. I'd like to clarify one point. Are you saying that I can delay submitting my 2011 taxes until we are in Canada for a full 12 month period? Since we arrived in April 2011 and traveled outside Canada for about 5 weeks, we will qualify in about early June 2012 for the 12 months (give or take, I'll need to do exact calculations). Can I use time in 2012 to qualify for the 2011 tax exemption? 

I started reading publication 54 and it really doesn't go into this situation very much. I know I need to read more deeply to see if I can find anything besides that fact that I don't qualify for the exemption. It just doesn't seem right that we'd have to pay double taxes.

Thanks, Lori


----------



## Bevdeforges

The delay in filing comes into play if you want to claim the foreign earned income exclusion. You can't file for the FEIE until you have been outside the US for 12 consecutive months (physical presence test) or until you have been resident for a full calendar year outside the US (bona fide resident test). 

Look on p. 4 of Pub 54, the section on "Extension of time to meet tests". (You'd think they'd put this in the section on the FEIE, but they don't.)
Cheers,
Bev


----------



## grind&gain

US expats can file their US returns till June 15th, but if you do not meet the 12 month period and want to use form 2555 (foreign earned exclusion) then you can file for an extension based on that.


----------

