US Tax Returns for Canadians, Coordinated With Your Canadian Return
A US passport, a Florida condo or a rental in Arizona can each mean a US filing as well as your Canadian T1. Bestax works out which US returns and forms apply to you and keeps both sides consistent, so the same income is not taxed twice.
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Canadians Who Usually Have a US Filing
Living in Canada does not end a US filing obligation, and owning or earning something in the US can create one. These are the situations that most often bring Canadian residents into the US system.
- US citizens, including those born in the US who have lived in Canada most of their lives.
- Green card holders living in Canada, whose US filing continues until the status is formally given up.
- Canadians who own a US rental property or receive US rent.
- Snowbirds who spend part of each winter in the US and need to show a closer connection to Canada.
- Canadians selling a US home, condo or vacation property.
- Canadian residents with US employment, pension, investment or retirement account income.
A US filing is never a separate file. Whatever goes on the US return also has to be reported on your Canadian T1, with the US tax claimed as a foreign tax credit where the treaty allows it.
For the wider picture, see our Cross-Border Tax Services and our Foreign Tax Credit Services.
What Our US Tax Return Service Covers
We prepare or coordinate the US work within the agreed scope, and match every figure to your Canadian return.
- A review of your citizenship, status, days in the US and US assets to confirm which US filings apply.
- Form 1040 for US citizens and green card holders, reporting worldwide income with treaty and credit positions.
- Form 1040-NR for Canadians with US-source income, including the net-basis election for US rental property.
- FBAR (FinCEN Form 114) and Form 8938 where your foreign accounts and assets reach the reporting thresholds.
- Form 8840, the closer connection statement, for snowbirds who meet the substantial presence test.
- Your Canadian T1, with the US income reported and the foreign tax credit calculated against it.
How the US Rules Reach Canadian Residents
The US taxes its citizens and green card holders on worldwide income wherever they live. Canada taxes its residents on worldwide income too, so a US citizen in Canada reports the same income twice and relies on the Canada-US tax treaty and foreign tax credits to avoid paying tax on it twice.
Canadians who are not US persons are taxed by the US only on certain US-source income, such as rent, and only become US residents for tax purposes if they meet the substantial presence test without an exception. Which return applies depends on that status, not on where you live.
US citizens and green card holders file Form 1040 on worldwide income, even with no US tax owing after credits.
Days in the US are counted each year under the substantial presence test, using the current year and the two before it.
Foreign account and asset reporting, such as the FBAR and Form 8938, is separate from the tax return itself.
Penalties for missed information forms can apply even when no US tax is owed, so they should not be left out.
The goal is one set of facts reported consistently in both countries, with each country’s credit rules applied so the income is not taxed twice.
US Filings and When They Are Due
Each US filing has its own form and its own date. These are the ones Canadian residents meet most often, for a calendar tax year.
| Filing | Who it applies to | Usual due date | What it reports |
|---|---|---|---|
| Form 1040 | US citizens and green card holders living in Canada | April 15, with an automatic two months for those living abroad; interest runs from April 15 | Worldwide income, with treaty positions and foreign tax credits |
| FBAR (FinCEN Form 114) | US persons whose foreign accounts total more than $10,000 at any time in the year | April 15, with an automatic extension to October 15 | Canadian and other non-US bank and investment accounts |
| Form 1040-NR | Canadians with US-source income, such as US rent | April 15 if you had US wages; otherwise June 15 | US-source income, and the net-basis election for real property |
| Form 8840 | Snowbirds who meet the substantial presence test | With the 1040-NR timing, generally June 15 | The closer connection to Canada that keeps you a US non-resident |
Extensions to file are available for most returns, but they do not extend the time to pay. State returns can also apply depending on where the income or property is.
What We Need for Your US Return
A US return is prepared from the same records as your Canadian one, plus the details only the US side asks for.
If you have missed past US filings, bring what you have. We will review the gap before preparing the current year, so the years fit together.
- Your last Canadian T1 and notice of assessment, and any prior US returns.
- Your US passport, green card or social security or ITIN details, where you have them.
- Slips and statements for all income, Canadian and US, for the year.
- Maximum balances during the year for each Canadian and non-US account.
- For US property: rent received, expenses, purchase details and any sale closing statement.
- For snowbirds: the dates you entered and left the US in each of the last three years.
Our US Tax Return Process
Confirm your status
We review your citizenship, residency, days in the US and assets to settle which US filings apply.
Gather both sides
We collect your Canadian and US income, account balances and property records in one list.
Apply the treaty
We decide the treaty positions and the order in which each country gives credit for the other’s tax.
Prepare the returns
We prepare or coordinate the US return and information forms, and your Canadian T1, from the same figures.
Review and file
You review everything before it is signed and filed, and we track each filing’s due date.
Plan the next year
We flag what to keep and what to watch, such as days in the US or a planned property sale.
Why Canadians Choose Bestax for US Filings
Both returns, one file
Your US and Canadian filings are worked from the same records, so the figures and credits agree.
Status settled first
We confirm which US rules apply to you before preparing anything, rather than filing by habit.
Information forms included
FBAR, Form 8938 and Form 8840 are checked every year, not only the tax return.
Property handled end to end
From annual rental reporting to the year of sale, US property is followed through both returns.
Plain answers
We explain what each form does and why it applies, so you know what to expect each year.
Related Bestax Services
Cross-Border Tax Services for individuals and businesses with active ties to both Canada and the US.
Foreign Tax Credits to claim US tax paid against your Canadian tax on the same income.
Personal Tax Returns for the Canadian T1 that has to match your US filing.
Non-Resident Tax Services for Canadian returns when you have left Canada or earn Canadian income from abroad.
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Frequently Asked Questions
Generally, yes. US citizens are taxed on worldwide income wherever they live, so you file Form 1040 if your income is above the filing threshold. Treaty positions and foreign tax credits for the Canadian tax you pay often reduce the US tax, but they do not remove the filing.
The FBAR, FinCEN Form 114, reports foreign financial accounts held by US persons. Canadian bank, investment and many registered accounts count as foreign accounts for this rule, and the FBAR is required when their combined value exceeds $10,000 at any time in the year.
A Canadian who is not a US person usually files Form 1040-NR to report the rent. Without an election, US tax is withheld on the gross rent; electing to treat it as effectively connected income lets you be taxed on the net amount after expenses instead. The rent and expenses are also reported on your Canadian T1.
You could meet the substantial presence test, which counts your days in the US this year and a portion of the two prior years. If you do, but spent fewer than 183 days there this year and keep closer ties to Canada, filing Form 8840 on time lets you claim the closer connection exception.
The buyer is generally required to withhold a percentage of the sale price under FIRPTA and send it to the IRS, unless an exception or a reduced withholding certificate applies. You then file a US return to report the actual gain and claim the withholding, and report the same sale on your Canadian return with credit for the US tax.
Usually not, if both returns are prepared correctly. The Canada-US tax treaty decides which country taxes each type of income first, and the other country generally gives a foreign tax credit for that tax. The credits only work if the income and tax are reported consistently on both returns.