US citizen with income abroad

[knarf]

I have a client who is both a citizen in the US and Canada. In 2009, he lived about 7 months in the US and 5 months in Canada. He had only interest income in the US and also a primary residence. In Canada, he had business income in a business venture there. Does he need to file a tax return in both countries or the country where he lived for more of the time? I would appreciate any insight into this matter. thank you.

[Lion]

US answer

A US citizen files a tax return reporting worldwide income. You'll have to check on Canadian law re a return for Canada; however, being a resident and having business income would seem to require a Canadian return. Then, look for a tax treaty between the two countries as well as exclusions for foreign income or a foreign tax credit.

[Uncle]

Of course

I have a client who is both a citizen in the US and Canada. In 2009, he lived about 7 months in the US and 5 months in Canada. He had only interest income in the US and also a primary residence. In Canada, he had business income in a business venture there. Does he need to file a tax return in both countries or the country where he lived for more of the time? I would appreciate any insight into this matter. thank you.

Your client is likely some sort of resident of Canada. Canada taxes on residency, but has several different kinds of resident. Sometimes makes a difference. Canada, and the relevant province, will want their take.

[Gretel]

Also watch out for SE tax. This separate tax is normally not included in tax treaties.