Tax Q&A – US Citizen Living in Canada..Do I Need to File?

Question

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

Answer

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

Newsglobal, CA

250-661-9417