"The hardest thing in the world to understand is the income tax."
CRA to Crack Down on International Tax Cheating
April 9, 2013
"As announced in Economic Action Plan 2013, our Government is taking strong action to tackle tax evasion. We are committed to cracking down on individuals who avoid paying their fair share of taxes" (Gail Shea, Minister of National Revenue).
2012 Tax Changes
Jan. 21, 2013
Recent tax changes for Canada and an update for the U.S.
The Globe and Mail Reports on FATCA
Jan. 7, 2013
A recent Globe and Mail article (IRS wants Canada to nab U.S. tax cheats: Why we should care) discusses the Foreign Account Tax Compliance Act (FATCA) and what it means for U.S. citizens living in Canada.
How Far Would You Fall Down The Fiscal Cliff?
Dec. 12, 2012
Slate.com has published an amusing interactive graphic that shows how far taxpayers might fall down the upcoming "fiscal cliff." Have fun hurling sample taxpayers into fiscal oblivion!
CRA Announces Indexed Amounts for 2013
Dec. 12, 2012
Certain personal income tax and benefit amounts are indexed to inflation annually. CRA has announced the 2013 indexation adjustments for personal income tax, benefit amounts, and Tax-Free Savings Accounts (TFSAs).
IRS Revises ITIN Application Procedures
Nov. 29, 2012
The Internal Revenue Service announced updated procedures to strengthen the Individual Taxpayer Identification Number (ITIN) program requirements.
Consumer Reports on Fraudulent Tax Return Scams
Sept. 28, 2012
The October issue of Consumer Reports magazine discusses a tax scam: identity thieves file your tax return before you do, claiming false deductions and pocketing the refund. CR asserts that 940,000 returns were filed this year by identity thieves using other people's names.
IRS Announces New Filing Compliance Procedures for Non-Resident U.S. Taxpayers
June 28, 2012
Taxpayers taking advantage of the new procedures will be required to file tax returns for the past three years (formerly six years), and delinquent FBARs for the past six years. The IRS will not assert penalties or pursue follow-up actions for taxpayers presenting "low compliance risk."
IRS Strengthens ITIN Application Requirements
June 26, 2012
The IRS announced interim changes to its procedures for issuing Individual Taxpayer Identification Numbers (ITINs). For now they will only issue ITINs when applications include original documentation, such as passports and birth certificates, or certified copies of those documents from the issuing agency. Final rules will be issued before the start of the 2013 filing season.
CRA Addresses Myths About eFiling
April 12, 2012
Canada Revenue Agency debunks the commonly held belief that those who file online are more likely to be audited, noting that audits are based on broad and complex criteria, but not filing method. Also, see this list of facts about online filing.
IRS Offers Tax Tips for Taxpayers with Foreign Income
March 19, 2012
The Internal Revenue Service reminds U.S. citizens and resident aliens living or working abroad that they may have a U.S. filing requirement, and offers seven tips for taxpayers with foreign income.
Highlights of 2011 Tax Changes
Jan. 23, 2012
Recent tax changes from CRA's General Income Tax and Benefit Guide and IRS Publication 17.
New Reporting Form for Foreign Financial Assets
Jan. 23, 2012
If you had foreign financial assets in 2011, you may have to file the new Form 8938 with your return. There are different rules and amounts for married or unmarried taxpayers, and for taxpayers living inside or outside the United States. The IRS has posted a special page for this form, with links to the instructions, recent developments, and other useful items.
Due Date Extended for 2011 U.S. Returns
Jan. 4, 2012
The IRS announced that the due date for filing Forms 1040, 1040A, and 1040EZ will be April 17, 2012 (April 15 is a Sunday and April 16 is the Emancipation Day holiday in the District of Columbia).
New IRS Fact Sheet for U.S. Citizens Living Outside the U.S.
Dec. 13, 2011
The IRS appears to be showing some leniency for U.S. taxpayers abroad who haven't been filing U.S. tax returns or FBAR statements, noting that penalties will not be imposed in all cases.
Canada Pension Plan Changes for Individuals Aged 60 to 70
Dec. 12, 2011
Canada Revenue Agency outlines changes to the Canada Pension Plan (CPP) that will occur in January 2012. The changes will affect both employees and self-employed workers.
Tax Information for U.S. Citizens or Dual Citizens Residing Outside the U.S.
Dec. 9, 2011
The IRS announced today it is aware that some taxpayers have failed to timely file United States federal income tax returns or Reports of Foreign Bank and Financial Accounts (FBARs). A new fact sheet summarizes information about federal income tax return and FBAR filing requirements, how to file a federal income tax return or FBAR, and potential penalties.
The Seven Biggest Economic Lies
Oct. 14, 2011
Robert Reich (author of Aftershock), presents a short video and article debunking the "seven biggest whoppers now being told by those who want to take America backwards."
Offshore Voluntary Disclosure Deadline Extended
Sept. 2, 2011
Due to the potential impact of Hurricane Irene, the IRS has extended the due date for offshore voluntary disclosure initiative requests to September 9, 2011 (also applies to taxpayers filing delinquent FBARs).
Tax Credit for Volunteer Firefighters (Canada)
Aug. 25, 2011
This new non-refundable tax credit is available to any volunteer firefighter who serves at least 200 hours per year, and can reduce tax by as much as $450.
Recent Newspaper Articles
Aug. 25, 2011
Offshore Voluntary Disclosure Initiative Deadline Approaches
Aug. 11, 2011
U.S. taxpayers with income in undisclosed offshore accounts are running out of time to come clean with the IRS. The 2011 Offshore Voluntary Disclosure Initiative expires on Aug. 31, 2011 (more information).
U.S. Delays Tax Evasion Crackdown
July 15, 2011
According to today's Globe and Mail, the IRS announced Thursday it is delaying until 2014 the new law requiring foreign financial institutions to identify U.S. account holders to Washington. Read IRS Notice 2011-53 (pdf) for the technical details.
IRS Urges Taxpayers to Avoid Becoming Victims of Tax Scams
July 14, 2011
The IRS notes an increase in tax-return-related scams, frequently involving unsuspecting taxpayers who normally do not have a filing requirement in the first place. These taxpayers are led to believe they should file a return with the IRS for tax credits, refunds or rebates for which they are not really entitled.
New Children's Arts Tax Credit (Canada)
July 8, 2011
Parents can now claim a credit for money spent on fine arts programs (including music, performing arts, outdoor wilderness training, learning a language, studying a culture, tutoring, etc.), with potential tax savings of $75 per child.
Recent Globe and Mail Articles
June 23, 2011
Canada Post Strike
June 16, 2011
There is currently no mail delivery service across Canada due to the Canada Post lock-out. Canada Revenue Agency has created a page of helpful information related to the postal disruption.
New Website Launch
June 15, 2011
Welcome to our new site. It's a bit more colorful than the old one!
Turn Medical Expenses into Deductible Business Expenses
May 13, 2011
Many individuals in Canada with substantial medical costs do not see any tax savings at all. Here's how to use a Private Health Services Plan to make medical expenses fully deductible.
A Change to Form 1116
April 3, 2011
We noticed this bit of technical news while perusing the instructions for the form. Prior to the change only certain gains or income from U.S.-owned foreign corporations were directed to use the "Certain Income Re-Sourced by Treaty" category of Form 1116. For tax years beginning after August 10 2010, *any* item of U.S. source income that is re-sourced as foreign income by way of a tax treaty will use the "Certain Income Re-Sourced by Treaty" category, and be subject to the foreign tax credit limits calculated on Form 1116.
IRS Steps Up Enforcement of Foreign Artist Tax Withholding
March 15, 2011
FTM Arts Law reports on its blog that the Internal Revenue Service is using the internet to find nonresident artists who will tour the United States, contacting presenters and venues where the performances are scheduled, and directing them to withhold 30% of the artists' gross fee.
Canadian Banks to Report U.S. Account Holders to IRS
Feb. 20, 2011
Cross-border tax preparers who have studied the HIRE Act (the "Hiring Incentives to Restore Employment Act" of 2010) are reporting that, beginning Jan. 1 2013, Canadian banks and investment firms will be required to ask every account holder if they are a U.S. citizen, and if they are, report information about their accounts to the IRS. If the account holder refuses to answer, 30% of investment earnings will be withheld and remitted to the IRS.
Should TN Visa Holders in the United States File Form 1040 or 1040NR?
Feb. 22, 2011
TN status is a non-immigrant visa category that permits Canadian and Mexican citizens in certain occupations to live and work in the United States. The fact that it is a temporary visa allowing for long-term residency can make it difficult to decide which U.S. tax form to file.