US Citizen's US Residency before moving to Canada for 1 year
bai...@gmail.com
I have an interesting scenario I am hoping someone could provide
worthy advice for. I am a natural born US citizen who has lived in
the US my entire life and in Massachusetts for the past 9 years. My
car is insured and registered in Massachusetts and its also my current
mailing address. In 2 months, I am vacating my current apartment
which I rent and moving to Canada for 1 year on a temporary work
permit. Effectively, I no longer have a current US residential
address. After my 1 year work permit expires in Canada, I will be
moving back to the US- where I move to is still unknown.
At this juncture, does it make sense to establish a mailing address in
any state, preferably one that has tax advantages or that makes my car
insurance less expensive? What about my car while I am in Canada?
Where does it stay insured? Technically, I cannot "import" my car or
want to into Canada since I only have temporary status. Can I keep it
insured in Massachusetts by simply going to the UPS Store and getting
a mailing address there? (they have postal boxes that include street
address and suite number rather than PO Boxes) I have alot of
unanswered questions about this whole process.... What type of lawyer
would I want to consult?
In wrapup, I am a US Citizen, leaving my current living situation in
the US to be effectively without a US postal address (unless i
establish one at the UPS Store), and returning back to the US in 1
year. What do I do?
Thanks alot.
Mark Bole
I can't answer all your questions, but I do know that it takes a lot
more than a mailing address (physical or rent-a-mailbox) to establish
(or dis-establish) residency. Based on what you have said, you will
continue to be subject to U.S. and Massachusetts state income tax laws
since your domicile will continue to be in Massachusetts until you
establish a new one. When you move back to some state other than MA,
and intend to stay there permanently or indefinitely, then you will be
able to say you have established a new domicile.
You probably don't need a lawyer so much as a CPA or other paid tax
preparer who has handled similar situations. I know at least one firm
(H&R Block) which handles both U.S. and Canadian tax clients
(http://www.hrblock.ca/services/us_citizens.asp) and they will probably
be able to give you a little free advice, you can decide where to go
from there. Just spending two minutes at this web site will tell you,
for example, that you will have to file both U.S. and Canadian returns
but probably will be able to avoid double-taxation of the same income.
Your employer can also probably give you more information if they do
this kind of thing often.
-Mark Bole
Condor
The following websites offer expertise in cross-border U.S. - Canada
taxation:
Condor