Download U.S. - Canada Planning [PDF]
The U.S. is Canada’s largest foreign investor and Canada is the third largest foreign investor in the U.S. In an increasingly mobile global economy, more and more individuals, businesses and families are not only traveling across borders and setting up a presence in more than one country, but are also holding their assets in more than one place. This cross-border activity has given rise to a number of questions to consider:
- What are the implications for Canadian snowbirds that have real property in warm weather areas of the U.S., such as Florida, California or Arizona?
- Canadian business owners may consider acquiring residences in the U.S., and vice versa – how might this impact one’s estate plan?
- How do visa holders (especially work visas and paths to green cards) need to evaluate emigration and the costs associated with it? What happens if they want to go back to their roots even after attaining a visa?
- No matter where one decides to go, how are their retirement plans affected, and what reporting requirements do they need?
Given the fact that the U.S. and Canada share the largest border in the world and have one of the healthiest trade relationships, every opportunity to take advantage of this strong relationship must be taken. To help readers who currently have assets in both countries, or are considering doing so in the near future, Northern Trust has written a new paper called U.S.—Canada Planning: Global Planning for wealth straddling U.S. – Canada border. In this new publication, Susan Merritt, Senior Fiduciary Officer, and Suzanne Shier, Wealth Planning Practice Executive and Chief Tax Strategist/Tax Counsel, examine various considerations that any individual and his or her U.S. advisors should consider, such as:
- What is the individual’s U.S. tax status?
- What U.S. income tax issues must be considered?
- Will the U.S. transfer taxes apply?
- Examples of U.S. estate tax application
- The Canadian rules
- Does the Canadian individual need a U.S. based estate plan?
- What if the Canadian individual emigrates to the U.S.?
- What if the Canadian individual holds Canadian retirement plans?
- Are there any foreign reporting requirements?
- What if a Canadian individual relinquishes his or her green card?
Bridging the differences between the two countries’ tax systems can be a complex undertaking. But by asking the right questions and planning accordingly, one can be sure to maximize the benefits of such a strong relationship between these two countries and potentially avoid surprising or cumbersome tax penalties. FOR MORE INFORMATION
As a premier financial firm, Northern Trust specializes in life-driven wealth management backed by innovative technology and a strong fiduciary heritage. For 125 years we have remained true to the same key principles – service, expertise and integrity – that continue to guide us today. Our Wealth Planning Advisory Services team leverages our collective experience to provide financial planning, family education and governance, philanthropic advisory services, business owner services, tax strategy and wealth transfer services to our clients. It is our privilege to put our expertise and resources to work for you.
If you’d like to learn more, contact a Northern Trust professional at a location near you or visit us at northerntrust.com.
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Legal, Investment and Tax Notice: This information is not intended to be and should not be treated as legal advice, investment advice or tax advice. Readers, including professionals, should under no circumstances rely upon this information as a substitute for their own research or for obtaining specific legal or tax advice from their own counsel.