Complex US/Canada tax advice

[selimevets]

What is the name of your state? CO (previously), currently NS (Canada)

In an attempt to be brief, I'll summarize what I believe to be the milestones relevant to my situation. We (husband and wife) still have our Permanent Resident cards, though our "official" residence has been in Canada since Dec 2005.

Though my taxes were just prepared by a professional tax service for 2005 (late) and 2006 for both the US and Canada, my understanding of the reasons are limited. Can someone help me understand who I should be filing taxes with for 2005, 2006 as well as 2007 and beyond?

Would relinquishing Permanent Resident card simplify things for future years from a tax perspective?


Husband
~~~~~~
Born & raised in Canada (citizen).
Move to US 1995, acquire Conditional Resident status.
1997, aquire Permanent Resident Status.
1997, Divorce from 1st wife.
2002, married to current wife.
Dec 2005, relocate to Canada
Feb 2006, sale of US residence completed.

Husband's Employment
~~~~~~~~~~~~~~~
Work for US entity through April 2006, including standard US payroll benefits and deductions.
Work for Canada entity starting April 2006, including standard Canada payroll benefits and deductions.


Wife
~~~~
Born & raised in Canada (citizen).
Move to US 1996, acquire Conditional Resident status.
1998, aquire Permanent Resident Status.
1998, Divorce from 1st husband.
2002, married to current husband.
Dec 2005, relocate to Canada
Feb 2006, sale of US residence completed.

Wife's Employment
~~~~~~~~~~~~~~
Work for US entity through Fall 2005, including standard US payroll benefits and deductions.
No further employment.

 

[LdiJ]

If you do not plan to reside in the US again, then it might be simpler to relinquish your US residency. However you do have a foreign income exclusion of 82,400.00 (for US taxes) there is a tax treaty between the US and Canada. You can read it here:

https://forum.freeadvice.com/showthread.php?t=299398

And, if you give up your US residency you would also give up your potential social security benefits upon retirement, although you probably have not amassed a huge amount of credits.

 

[abezon]

If you do not plan to reside in the US again, then it might be simpler to relinquish your US residency. However you do have a foreign income exclusion of 82,400.00 (for US taxes) there is a tax treaty between the US and Canada. You can read it here:

https://forum.freeadvice.com/showthread.php?t=299398

And, if you give up your US residency you would also give up your potential social security benefits upon retirement, although you probably have not amassed a huge amount of credits.

You have to file a US return because you have green cards. Period. If you have no plan to return to the US, you're supposed to relinquish your cards upon exiting the US.

Giving up US residency does not give up social security benefits. Check out the totalization agreement info on the social security administration's web site (www.ssa.gov). However, since you don't have 10 years working in the US, you'll either get reduced US benefits or an increased CPP benefit.