Tax and other financial matters concerning Canadian professionals
in the U.S. and U.S. citizens in Canada Includes income and estate taxation, social security, health
insurance, retirement accounts, cross border tax issues, and other matters affecting your pocketbook.
Topic Administrator: Mark T. Serbinski, CA, CPA of Serbinski
Weinberg, Ltd. CPA's and Serbinski Partners, Chartered Accountants
My wife and I have been living in the US for a few years already. My wife's father recently passed away and she inherited of her father's house in Canada. When she decides to sell this property she will have to deal with capital gain because she doesn't live in this house, but are the rules different because she is not resident of Canada ? From what I understand, a resident would pay capital gain taxes on the difference between the fair market value of the house at the time her father passed away and the price she sells it for (please correct me if I'm wrong). Any advice on how to deal with this situation would be appreciated. Thanks.
The tax treatment is the same, except that, if she is non-resident at time of sale, she must comply with certain reporting aspects prior and after sale.
Any gains would ALSO have to be reported in US if still living there, with credit taken for Cdn tax paid.
Could you explain a little more what you mean by "reporting aspects prior and after sale". Thanks.
Non-residents must have certain portion of the proceeds withheld at sale; that portion can be reduced or eliminated by filing certain forms with CRA before closing.
Also, the sale must be reported on a non-resident tax return, as opposed to simply having NR tax withheld as final tax payment (like non-resident interest and dividend income, for example).
You will find all you need to know at CRA's "International" section of their website. All this will only be of interst to you if you sell while still outside Canada.
Tax and other financial matters concerning Canadian professionals
in the U.S. and U.S. citizens in Canada Includes income and estate taxation, social security, health
insurance, retirement accounts, cross border tax issues, and other matters affecting your pocketbook.
Topic Administrator: Mark T. Serbinski, CA, CPA of Serbinski
Weinberg, Ltd. CPA's and Serbinski Partners, Chartered Accountants
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