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Foreign Canadian iincome and what credits I'm allowed to claim on it

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maxim_311

Junior Member
California resident

As we all know taxes can be convoluted depending on your situation. So Im gonna try and keep it simple and give bullet points

- 2012 worked in Canada for 2 months. Made $20,235. Got Canadian refund of $3,797

- On 2012 return accountant forgot to include my foreign income

-I got a Fed refund fed $3,876 and state $1,774 with total reported income of $75,572 (this is without foreign income)

-I spotted accountants omission of my foreign Canadian income ($20,235) and have him amend my return

- Now I owe Fed $1,353 and State $1,925 with total reported income $95,808

QUESTIONS

- Is this giant swing in my refund seemingly correct?

- With foreign income you're supposed to be able to deduct/write-off taxes you paid in Canada. In the #7 Credits field of my 1040X he used my Canadian refund amount of $3,797. Shouldn't he have used the total of the taxes that were deducted from my Canadian pay? ($4791 Income Tax, $961 Canadian pension plan, $370 unemployment insurance) which totals $6,122

- Owing money to the Federal gov't I can understand. But why does my state tax liability rise on money made out of the country?
 


davew128

Senior Member
California resident

As we all know taxes can be convoluted depending on your situation. So Im gonna try and keep it simple and give bullet points

- 2012 worked in Canada for 2 months. Made $20,235. Got Canadian refund of $3,797

- On 2012 return accountant forgot to include my foreign income

-I got a Fed refund fed $3,876 and state $1,774 with total reported income of $75,572 (this is without foreign income)

-I spotted accountants omission of my foreign Canadian income ($20,235) and have him amend my return

- Now I owe Fed $1,353 and State $1,925 with total reported income $95,808

QUESTIONS

- Is this giant swing in my refund seemingly correct?

- With foreign income you're supposed to be able to deduct/write-off taxes you paid in Canada. In the #7 Credits field of my 1040X he used my Canadian refund amount of $3,797. Shouldn't he have used the total of the taxes that were deducted from my Canadian pay? ($4791 Income Tax, $961 Canadian pension plan, $370 unemployment insurance) which totals $6,122

- Owing money to the Federal gov't I can understand. But why does my state tax liability rise on money made out of the country?
Your accountant should have used your actual Canadian INCOME tax, which is about $1,000. As for the state, California taxes your worldwide income just as the feds do and doesnt offer a credit.
 

maxim_311

Junior Member
Your accountant should have used your actual Canadian INCOME tax, which is about $1,000. As for the state, California taxes your worldwide income just as the feds do and doesnt offer a credit.
What do you mean my "Actual Canadian INCOME tax"? Where did you get that $1000 figure from?
 

LdiJ

Senior Member
What do you mean my "Actual Canadian INCOME tax"? Where did you get that $1000 figure from?
They withheld 4791.00 from your pay and you got a refund of 3797.00, therefore you only PAID 994.00 in actual Canadian income tax.
 

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