Many Canadian Zoomers spend their winters in the U.S. and yet there is considerable misinformation circulating about the amount of time Snowbirds can spend in the United States to comply with the tax and immigration rules. Getting your timing wrong can lead to a lot of problems, so it’s important to get it right.
It’s always a good idea to speak to a qualified tax or legal advisor who specializes in cross border matters to see how these rules apply to your specific situation. There are two separate formulas Canadians must comply with for the U.S. – one for immigration and one for tax.
Firstly there’s the US Immigration Act. A Canadian resident cannot be in the US for more than 180 days in a year. This is not a calendar year, but a rolling 365 day period, calculated by looking back over the last 365 days. If you have been in the US for more than 180 days within this 365 day period, you are subject to deportation and denial of entry in the future.
Secondly there are the tax implications. There are complex rules that define a U.S. resident for tax purposes under the US Internal Revenue Code. Canadian snowbirds should avoid being considered U.S. residents for tax purposes at all costs, as it can lead to significant additional income tax being owed to the IRS. US residency is based on how many days you have spent in the U.S. over the last three calendar years. Days spent in the US during this calendar year count as one day, but days spent in the US in the two previous years count as only one third and one sixth, respectively, towards the total. If the total number of days in the US over this three year period totals 183 days or more, you will be considered a U.S. resident for tax purposes…
Confused? It’s understandable: that’s why I recommend that you speak to a qualified advisor! More details are available on the very useful website at www.SnowbirdAdvisor.ca.