If you are a Canadian and own property in the U.S., or if you spend or planning to spend significant portion of your time in the U.S., or are working in the U.S. you must read Bob Keats’s “Border Guide – A guide to living, working and investing across the border” N-th Edition .
I have read Bob Keats’s book before, but I attended recently one of his workshops. The message he is delivering is that moving or investing across the border is very complex, but it can be an opportunity if you prepare prior to going into action. His message in person is even more persuasive than reading about it. Here is what I heard:
• The Canada-US treaty can override local laws-make sure there is a note to that effect in your estate documents
• Canada pension withholding tax is only 15%
• OAS claw back is eliminated • RRSP/RRIF done properly/improperly can be taxed at a lower/higher rate than normal
• Opportunity to benefit from US and Canada Medicare systems
• US based non-exempt assets (e.g. real estate, stocks) are all subject to estate tax
• US estate taxes can be eliminated with pre-entry trusts
• Proper titling of US real estate is critical
• US tax rates are lower and highest rates kick-in at much higher taxable incomes than in Canada
• Available Medicare and immigration mechanisms
• Canadian exit tax can be deferred until sale of asset with security deposit
The book is a great information source for a lot of these topics and I recommend it highly to you. But this subject is quite complex and those with real expertise are few and far between. Mistakes can be costly, especially if you have significant assets, so after reading the book, my advice would be to get help from an expert on the subject.