31 May 10 
Cross Border Tax Q&A Hi
I just found out the other say that all US citizens need to file US tax returns. I’ve been living in Ottawa (from Seattle) for the last 10 years.
I worked for the first 6 years, but have been unemployed for the other 4 years. If the IRS finds out will I be in big trouble?
Any information you can send me would be greatly appreciated.
Thanks
XXXXXX
Hi
Yes, you are correct, as a US citizen you are required to file 1040 tax returns even if you live outside of the US. The good news is that the US (IRS) has a tax amnesty provision that allows you to catch up on past due returns without any penalties or threat of criminal action.
The key is to contact them before they contact you. In most cases you would file the last 6 years of past due returns under the Amnesty provisions with the IRS.
Depending on the type of income you received in the earlier 2 years you’ll most likely not incur any additional taxes as the Canada US treaty includes provisions to eliminate (in most cases) double taxation between borders.
Hope that helps and please feel free to call me if you have any other questions.
Regards
Phil Hogan, CA
250-661-9417
This commentary reflects the personal opinions, viewpoints and analyses of the Beacon Hill Wealth Management Ltd. partner providing such comments, and should not be regarded as a description of advisory services provided by Beacon Hill Wealth Management Ltd. or performance returns of any Beacon Hill Wealth Management Ltd. client. The views reflected in the commentary are subject to change at any time without notice. Nothing in this commentary constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Beacon Hill Wealth Management Ltd. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results. Any discussion about taxation is for educational purposes only and should not be viewed as professional advice. Consult your tax professional for tax advice on your particular situation.
Comments