Answers · Topic 2 of 10
US Citizens and Cross-Border Personal Tax answers.
Filing on both sides of the border as a US citizen, green-card holder or Canadian with US income: what applies, what the treaty fixes, and what it does not. 20 questions, each answered in the first paragraph.
By the AnalytIQ Accounting team · Last reviewed: September 6, 2026
Are Canadian mutual funds and ETFs PFICs for US citizens?Yes, in almost every case.Can Canadians owe US estate tax on US stocks and other US assets?Yes.Can I file FBARs for previous years I missed?Yes - late FBARs can be filed for any past year through the same free BSA E-Filing System used for current ones, and the IRS provides two routes that keep penalties off the table.Do Canadians pay tax on an inheritance from the US?Not on receiving it.Do Canadians working in the US pay tax in both countries?Often you file in both countries, but you rarely pay full tax twice.Do US citizens living in Canada have to file US taxes every year?Yes.Do US companies send a 1099 to a Canadian contractor?Generally not.Should Americans in Canada use the Foreign Earned Income Exclusion or the foreign tax credit?For most US citizens living in Canada, the foreign tax credit (Form 1116) is the better choice.How are US Social Security benefits taxed for Canadian residents?The Canada-US tax treaty gives Canada exclusive taxing rights over US Social Security paid to a Canadian resident, so the US generally does not tax or withhold on it.How do I get a US ITIN from Canada?You apply on IRS Form W-7, attached to the US tax return that needs the number or supported by one of the IRS exceptions such as a FIRPTA withholding certificate or a treaty withholding claim.How does the Canada-US tax treaty decide which country I am a resident of?Article IV of the treaty applies a fixed sequence of tests to anyone who counts as a resident of both countries under domestic rules: where you have a permanent home, where your personal and economic ties are closer, where you habitually live, and finally which country you are a citizen of.How is an RRSP treated on a US tax return?An RRSP is one of the few Canadian accounts the US tax system treats kindly.How many days can a Canadian spend in the US without becoming a US tax resident?If you repeat the same pattern every year, about 120 days keeps you under the IRS substantial presence test, because the test adds all of this year’s US days to one-third of last year’s and one-sixth of the year before and asks whether the total reaches 183.How much does a cross-border tax accountant cost in Canada?It depends on how many returns and information forms your situation needs.How much does it cost to file an FBAR?Nothing, if you file it yourself: the FBAR (FinCEN Form 114) is submitted free of charge through the Treasury BSA E-Filing System and there is no government filing fee.Is a TFSA taxable for US citizens living in Canada?Yes.What are the tax consequences of renouncing US citizenship from Canada?Renouncing ends your US filing obligations going forward, but it triggers a final set of them first.What is Form 8840 and when should a snowbird file it?Form 8840, the Closer Connection Exception Statement for Aliens, is a short IRS form that lets a Canadian who has met the substantial presence test remain a US non-resident by showing that their home, family and financial life are in Canada.What is Form W-8BEN and when does a Canadian need to sign one?Form W-8BEN is the IRS certificate a non-US individual gives to a US payer — a broker, an online platform or a client — to confirm foreign status and claim the reduced withholding rates in the Canada-US tax treaty.What is the IRS Streamlined Foreign Offshore Procedure and who qualifies?The Streamlined Foreign Offshore Procedures are the IRS program that lets US citizens and green-card holders living outside the United States catch up on missed filings without penalties.
Where we do the work
Rules at a glance · US Citizens and Cross-Border Personal Tax
Not sure which applies to you? Get a free proposal or book 15 minutes.
Key form1040 + FBARForm 1040 is filed every year on worldwide income; FBAR kicks in past US$10,000 in foreign accounts.
Key deadlineJune 15 abroadThe April 15 due date gets an automatic two-month extension for filers living outside the US.
Watch forPFIC on Canadian fundsCanadian mutual funds and ETFs held outside an RRSP are PFICs, needing Form 8621 each year.
ThresholdUS$10,000 FBARFBAR is required once combined foreign accounts exceed US$10,000 at any point in the year.
What we take off your plate
Cross-border tax for US citizens living in Canada, handled.
- 1040, FBAR and Form 8938 filed together, sized to what you actually hold
- PFIC calls made on Canadian funds before they become a Form 8621 problem
- Canadian and US returns prepared by one team
- Treaty positions and foreign tax credits lined up
- FBAR and T1135 foreign reporting
- ITIN applications certified in-house
Mistakes we fix
Three things that go wrong for US citizens living in Canada.
- Skipping FBAR or Form 8938 because Canadian tax was already paid on the same accounts
- Holding Canadian mutual funds or ETFs in a TFSA without knowing they are PFICs
- Assuming the treaty erasing US tax owing also erases the duty to file
Recognise one? Book a call and we will tell you what it is costing you.
How we can help · US Citizens and Cross-Border Personal Tax
Where we do the work.
Fixed fees, quoted after a short discovery call. Canadian and US filings under one roof.
Cross-border taxForm 1040, FBAR and PFIC reporting handled alongside the Canadian T1, not as an afterthought.Cross-border tax →Tax servicesThe Canadian T1 filed to use every foreign tax credit the US return already generated.Tax services →BookkeepingForeign account balances tracked year-round so the FBAR numbers are ready every spring.Bookkeeping →
Free proposal
A fixed fee for your cross-border tax work, in writing.
- Tell us about your business. The form takes about a minute.
- A short discovery call. Fifteen minutes to confirm what you need.
- A fixed fee in writing. We reply within one business day. No hourly surprises.
- Canadian and US filings under one roof
- Cloud-first: QuickBooks Online, Dext, Wagepoint
- Brampton, Ontario, with clients across Canada and the US
Answers
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