[Tax_Q]

Hi,

I am taking up a job in Canada this month with my landed immigrant status.
I have filed my 2005 US tax return as MFJ. My wife will continue to work in US for at least next one year. Please advice on the following:
- What is my filing status for my 2006 US tax return? I think MFJ resident. Is there any advantage if my wife works in US and maintain the residency in Canada (such as working in border state)?
- Any advice to save double taxation.
- What are the tax implications on Canadian side?

Thanks for your time and help.
Regards

Thomas

[AtlantaTaxExpert]

If you are a U.S. citizen, you must pass taxes on worldwide income. However, you can claim a credit for the taxes paid to Canada.

You will file MFJ.

As for Canadian taxes, I have no expertise there.

[Tax_Q]

Thanks ATE,

I am not an US citizen, but on a H1 status which will expire in Oct. In this situation, do I have to pay tax to US for my canadian earnings?

Once again thanks for your help.

[AtlantaTaxExpert]

Yes, because as a H-1 visa holder who files as a resident alien, ALL of your world-wide income is subject to U.S. tax, at least for 2006.

Now, you MAY want to investigate filing an expatriate dual-status return. It's somewhat complicated, but a careful reading of IRS Pub 519 (which can be download from www.irs.gov) should allow you to determine if it is advantageous to file such a return.

[Tax_Q]

ATE, Thanks for your useful advice.

[AtlantaTaxExpert]

Glad to help!

[JackieHandunge]

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Tax Information: Stay Ahead and Prepare with the Right Tax Information
Guides you on what is required of individuals and businesses with regard to filing taxes. Tax Deduction tips and information on Tax Return Refund.